Tullow to spend Sh17 billion in Turkana as it gears towards oil exportation
In a statement early this week, the firm said it was projecting at Sh80 billion ($800 million) in gross profit for 2017.
In a trading statement on Wednesday, the firm said its 2018 focus will be on the Early Oil Pilot Scheme (EOPS) that the Kenyan government hopes to use to test the waters in the international oil markets ahead of full scale production in a few years’ time.
“Kenya’s pre-development expenditure is expected to be about $80 million (Sh8.3 billion) and exploration and appraisal spend about $90 million (Sh9.3 billion),” said Tullow in the statement issued yesterday ahead of the release of full year financial results next month.
Tullow added that the recent phase of exploration and appraisal drilling in the South Lokichar Basin has now been concluded, with the firm reopening engagements with the government on the approach and timelines for full production especially now that the elections is over.
“Work is already under way on the EOPS, with initial injectivity testing commencing on Ngamia-11 and oil production and water injection facilities being constructed in the field ready to commence production/injection in the first quarter of 2018.”
The capital expenditure on Kenya will account for 37 per cent of the total of $570 million (Sh59 billion) the company will put into its Africa operations, although it expects to claw back some Sh11.4 billion ($110 million) from payments on sale of oil blocks in Uganda.
Tullow announced in November that it had raised Sh258 billion ($2.5 billion) in new loans to help fund its Africa’s operations in 2018.
The firm is yet to announce its total spend on the Kenya operations in 2017 — with the numbers expected next month — but it had estimated that by mid-2016, its cumulative spending in the country had surpassed Sh150 billion.
In a statement early this week, the firm said it was projecting at Sh80 billion ($800 million) in gross profit for 2017 from its global operations.
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