The National Oil Corporation of Kenya could lose the mandate of managing strategic petroleum reserves in the country. This move has weakened the state-run company, a media report said.
This could be one of the key functions that the company could lose control over if the proposals by the petroleum ministry come through. It is reported that regulation and market forces has put the National Oil Corporation of Kenya in a difficult spot over the years.
This year is big for Kenya as it marks nine years since its announcement on the oil discovery in Turkana. It was in March when the country announced that sweet oil was discovered in Turkana, pointing to the fact that the country’s oil deposits were likely to be more than Uganda’s.
In December, Tullow Oil chief executive officer Rahul Dhir said in a statement, “In Kenya, Tullow is in the process of re-assessing Project Oil Kenya to design an economic project at low oil prices whilst preserving the phased development concept.”
With the pandemic, the steep drop in oil prices have impacted investor confidence to phase the next phase of the Tullow Oil project that used up more than Sh200 billion between 2012 and 2018 alone.
“In parallel, over the coming months, the Joint Venture partners will work closely with the Government of Kenya on land and water agreements, gaining approval of the Environmental and Social Impact Assessments and finalising the commercial framework for the project. The successful completion of this work will enable the submission of Field Development Plans to the Government of Kenya,” he said in the statement.