Cabinet approves oil export plans

Kenya’s plans to join the ranks of oil producing nations got a major hot in the arm after the Cabinet approved plans for the development and commercialization of early crude oil.

The commercial and infrastructure arrangement will facilitate the creation of an international market through which the government can sell the country’s crude oil.

Through the move, Kenya will process up to 4,000 barrels of crude oil per day.

“Under this arrangement the country will commence with the production of 2000 – 4000 barrels per day which will be initially transported to Mombasa for refining,” reads the statement from Cabinet.

British oil exploration firm Tullow Oil has discovered approximately one billion barrels of crude oil in the South Lokichar basin.

The move for early oil commercialization comes after Uganda pulled out of a joint pipeline deal with Kenya. The government is however keen to test other alternatives such as the use of road and rail to evacuate the crude oil from Lokichar, before coming up with new designs for a pipeline.

Trucks will evacuate the oil from Lokichar to Eldoret from where it will be loaded onto trains to Mombasa.

“For this to happen, the Eldoret (Leseru) – Lokichar Road is being upgraded at a cost of Sh3.2 billion.  Also to be replaced under this plan is the Kainuk Bridge to allow for larger and heavier trucks to transport the crude oil,” Cabinet said on Thursday.

The government recently acquired the Kenya Petroleum Refinery Limited (KPRL) in Mombasa that will be used a storage facility for crude oil, as the government sources partners to refine the oil.

KPRL has 45 tanks for various products with a total networking capacity of over 484 million liters. 17 of the tanks are meant for refined products which can be heated and converted into crude oil storage tanks.

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Tullow Oil Cabinet Lokichar KPRL commercialization eraly oil

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