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Oil pipeline design out as Kenya eyes exports in 3 years

Kenya is eyeing its first crude exports by 2018 after Japan’s Toyota Tsusho completed the feasibility study and design of an oil shipment pipeline estimated at $4 billion (Ksh388 billion) from Uganda to Lamu.

Joseph Njoroge, the Energy principal secretary, said Thursday that the search for firms to build the mega pipeline will start in six months to December.

Kenya estimates its crude oil reserves to be about one billion barrels – which experts say is enough to make a pipeline viable even without Uganda with its estimated 6.5 billion barrels in reserves. “It is expected that the oil reserves can be monetised by 2018,” said Mr Njoroge.

“Feasibility studies for a crude oil pipeline running from Hoima in Uganda through Lokichar to Lamu have been completed. Request for proposals for the construction of the pipeline will be issued by third and fourth quarter.”

In June last year, Kenya, Uganda and Rwanda invited bids for a consultant to oversee a feasibility study and initial design for the construction of the 1,300-km pipeline.

The consultant was also expected to design tank terminals in Hoima, Lokichar and Lamu as Kenya and Uganda eye petrodollars.

The design also involves the construction of a nine-kilometre pipeline from the Lamu tank terminal to offshore mooring buoys.

East Africa has become an attractive destination for international oil firms after Kenya, Uganda and Tanzania discovered oil and natural gas.

Kenya’s plans for oil production have moved fast since Tullow and Africa Oil’s first discoveries were announced in March 2012.

Tullow Oil and Africa Oil are expected to start pumping by 2016.

READ: Tullow puts development of Kenya oil fields on fast track

In contrast, neighbouring Uganda struck oil in the Albertine rift basin in 2006, but commercial production has been delayed amid wrangles over a refinery, among other factors. The country aims for commercial output by 2016 at the earliest.

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