Tullow aims for more wells after new oil discovery

The Ngamia 1 site in Turkana where British firm Tullow struck oil. Photo/File 

By Mugambi Mutegi, pmutegi@ke.nationmedia.com

In Summary

• Ekales-1 is located in between Ngamia-1 and Twiga South-1 --where oil was also discovered.
• The firm said it would undertake further testing of the area to ascertain productivity.
• Tests on Twiga-1 and Ngamia-1 have confirmed the two wells alone have a potential of 250 mmbo.

British oil exploration firm Tullow’s announcement yesterday that it had struck fresh oil deposits in northern Kenya has further deepened the prospects of Kenya becoming an oil producer, analysts said.

The find, which is the fourth consecutive wildcat discovery since Tullow began exploratory drilling in the semi-arid region in 2012, was made at the Ekales-1 well in Block 13T in Turkana County.

Tullow said the well will now be tested to confirm productivity but reservoir volumes are expected to be over 50 million barrels gross recoverable oil.

In its July update, Tullow announced that Ngamia-1 and Twiga South-1 wells had, after further analysis, yielded a net oil of 200 metres and 75 metres respectively or double the previous estimates. The two wells are now estimated to have a combined potential of producing 250 million barrels of oil.

More than 40 metres of oil reserves were discovered in Etuko-1 early this year pushing the combined known resource in the basin to more than 300 million barrels — the commercial production threshold.

Top Tullow officials said on Thursday that the latest find is evidence of the exceptional oil potential in the Rift Valley basin, raising hope of additional finds.

“This success at the Ekales-1 wildcat is further evidence of the exceptional oil potential of our East African Rift Basin acreage. Having opened the first basin with the Ngamia-1 well last year, we are now increasing the pace of exploration in Kenya aiming for 12 wells over the next 12 months,” said Angus McCoss, Tullow Oil’s exploration director, adding that drilling had commenced at the Agete-1 well in block 13T.

(Read: Tullow strikes new oil deposits in Turkana)

Kenya government officials received news of the discovery with measured excitement saying Tullow had yet to share with them the exact figures.

“It seems that Tullow is making a lot of progress in their explorations,” said Energy secretary Davis Chirchir.

“It is the right time to speculate about just how much oil we expect to find through Tullow and explorers in other blocks. However, since these firms are bound by a contract, they will update us in due course and we will know and share the exact figures in a year’s time.”

Tullow has operations on five on-shore blocks in Kenya, including 10A, 10BA, 10BB, 13T, 12A and 12B and a non-operated partner in off-shore block L8 where American exploration firm Apache Corporation is searching for oil.

Analysts said Tullow’s exploration successes in northern Kenya have raised Kenya’s profile as a viable frontier market investment destination.

“This is the fourth successful well in the Lokichar Basin, and proof of a high drilling success rate for the investors,” said George Wachira, a director at Petroleum Focus Consultants.

The latest discovery pushes Kenya’s oil deposits deeper into commercial viability threshold that Tullow said it had achieved with the Etuko-1 discovery early this year.