Kenyan President Mwai Kibaki announced on Monday the discovery of oil in the country for the first time.
"This morning, I have been informed by the Minister for Energy that our country has made a major breakthrough in oil exploration," Kibaki said, while declaring the performance results of public agencies for fiscal year 2010-11.
Anglo-Irish firm Tullow Oil plc (TLW.L), which has been prospecting for oil in the country's arid north-western region, discovered oil in Turkana County at the weekend at a depth between 846 and 1,041 meters.
They established over 20 meters of what is technically referred to as OIL-PAY. To establish commercial viability of this oil, they have to drill more wells.
Kibaki said although successful drilling of the oil was still years away, it marked "the beginning of a long journey to make our country an oil producer."
He pledged to disclose more information on the potential of the discovery as the oil exploration process progressed.
Kenya's oil deposits could be bigger than that of regional neighbor Uganda, which is already in the list of potential oil producing countries, according to Energy Minister Kiraitu Murungi.
Tullow Oil, which also explored in Uganda, said oil in Kenya has similar properties to the light waxy crude discovered in Uganda.
The company said as part of its major exploration campaign in the East African rift basins of Kenya and Ethiopia, oil in Ngamia-1 exploration well would now be drilled to a depth of approximately 2,700 meters to explore for deeper potential.
"On completion of operations, the Weatherford 804 rig will move to the Tullow Operated Block 10A where the Paipai-1 wildcat will spud in 2H 2012," it added.
Tullow has a 50 percent operated interest in multiple licenses in the Kenya & Ethiopia Rift Basins covering in excess of 100,000 square kilometers. Tullow operates Block 10BB in partnership with Africa Oil.
Despite several decades of intermittent exploration, Kenya still depends on other countries for its crude petroleum requirements. Petroleum accounts for 20 to 25 percent of the national import bill. East Africa's largest economy, Kenya is a regional business and tourist hub.
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by RTT Staff Writer
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