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Kenya crude oil capacity economically unviable for refinery

Crude oil deposits discovered in Kenya are insufficient to justify construction of a refinery, a senior petroleum ministry official said on Tuesday. Kenya discovered commercial oil in 2012 in its Lokichar basin, which Tullow Oil estimates contains an estimated 560 million barrels in proven and probable reserves. Tullow has said this would translate to 60,000 to 100,000 b... Read more

International mining forum opens in Sudan

  The Fourth Annual Sudan International Mining Forum and Exhibition opened on Monday in capital Khartoum, with more than 40 countries in participation. “This forum is convened under very complicated regional and international circumstances,” said Sudan’s Prime Minister Mutaz Musa, when addressing the forum’s opening session. The current challenge... Read more

US investors demand $96m for loss of Rwanda contracts

  A group of US investors have taken Rwanda to an international court, seeking compensation of $95 million after the government seized their mining concessions, effectively denying them operating licences. The suit before the International Centre for Settlement of Investment Disputes (ICSID) is a setback to Rwanda’s mining sector, which has lately gone through a se... Read more

Rwanda tin mine collapse kills fourteen workers

Fourteen people have been killed in a tin mine in eastern Rwanda after a hill collapsed on them following heavy rains, officials said. "Because of recent rainfall in the area, part of the hill nearby collapsed and 14 miners who were getting ready for work were buried by land," Fred Mufuruke, governor of Eastern province, told Reuters news agency on Monday. ... Read more

loriCrude oil deposits discovered in Kenya are insufficient to justify construction of a refinery, a senior petroleum ministry official said on Tuesday.

Kenya discovered commercial oil in 2012 in its Lokichar basin, which Tullow Oil estimates contains an estimated 560 million barrels in proven and probable reserves. Tullow has said this would translate to 60,000 to 100,000 barrels per day of gross production.

It is proven the world over that a refinery would make money only when it has refining capacity of at least 400,000 barrels a day, Andrew Kamau, principal secretary at the petroleum and mining ministry, told reporters.

“And we have 80,000 barrels a day, so where are we going to make money on that? We can import cheaper from India,” he added.

Kenya, which does not export any oil, previously had a crude oil refinery at its port city of Mombasa but halted operations in 2013 after plans for a $1.2 billion upgrade were abandoned on the advice of consultants who said it was not economically viable.

The government took it over in 2016 and converted it into a storage facility.

Other partners in the blocks with crude oil discoveries are Africa Oil Corp and Total.

Last week Tullow said it expected commercial framework agreements from the government and deals over land acquisition for an 800 km pipeline and oilfield infrastructure in the first quarter.

The government announced its intention to list state-run National Oil Corporation of Kenya in November 2017 to raise $1 billion in a dual listing on the Nairobi bourse and London Stock Exchange (LSE) by early 2019.

The Nairobi Securities Exchange has said the local listing will be by the end of 2019.

Mr Kamau said the listing will only take place after a final investment decision (FID) is agreed. Tullow says it expects that decision to happen by the end of this year.

“The listing will only be done after FID. Because that’s when you book the reserves; before that you really can’t do anything,” he said. 

Source: The EastAfrican