Canadian owned oil firm, Africa oil has sold half of its stake in 3
blocks to Danish owned Maersk Oil. Africa Oil is Tullow's joint venture partner
in Turkana’s exploration fields and co-owns the blocks on an equal basis.
The fields comprise of Blocks 10BB, 13T
and 10BA in Kenya and the rift basin, south Omo blocks in Ethiopia. The farm-out
is as a bid to raise some $350 million for use in further exploration and developmental
costs. The first oil discovery by the
two companies was in Block 10BB in March 2012 where significant crude oil deposits
have since been found in the surrounding 3 blocks .
Africa Oils President and CEO Keith Hill
stated that "This transaction puts Africa Oil in the position of not
requiring any additional equity financing prior to first oil and will allow us
to weather the current difficult oil price environment should it continue into
2016,"
Crude prices oil prices have been
tumbling since June 2014 and have plunged to as low as $30 per barrel as of
Tuesday 12th January 2016. Majority of the oil companies have been
forced to cut back on exploration projects, staff and investments. The commencement of oil
production in places where recent discoveries have been made is likely to be
delayed. However, Kenya seems to be hopeful that production shall begin towards
the end of 2016, even as the global crude oil prices are predicted to recover within the
next 2 years.
"We feel Maersk will be an excellent
partner in terms of technical and financial strength and experience critical to
moving the development project forward," said Mr Hill.
It is at this time though
that Kenya could consider setting infrastructure in place, such as pipelines,
refinery upgrade, security and storage in readiness for when the oil production
begins.
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