The Company believes there is a very strong market for gas development in Kenya and have already engaged in discussions with power companies and the government to potentially fast track a gas to power project that could add significant value and create benefits for the people of Kenya

The PR Marriott 46 rig has recently completed the Ngamia-2 well which was drilled 1.7 km from the Ngamia-1 discovery well to test the northwest flank of the prospect. The well encountered up to 39 meters of net oil pay and 11 meters of net gas pay and appears to have identified a new fault block trap north of the main Ngamia accumulation. The reservoirs were high quality with more than 200 meters of net reservoir sands with good permeability inferred from MDT sampling.

In Kenya, the Company has 4 additional rigs active in the South Turkana Basin where oil discoveries have previously been announced at Ngamia, Twiga, Agete, Amosing, Ekales, Etuko and Ewoi

The SMP-5 rig has completed testing operations on the Agete-1 well where it confirmed the Auwerwer pay previously released, the well flow rate was tested at 500 barrels of oil per day. This rig is now currently on location at the Ewoi-1 discovery and is preparing to test, after which it will continue to be used to test discovery and appraisal wells in this basin.

The Weatherford 804 rig is currently drilling the Agete-2 downdip appraisal well and will then move to drill the Etom prospect located 7 kilometers north of the Agete discovery along the basin bounding 'string of pearls' trend.

The Sakson PR-5 rig is drilling ahead on the Amosing-2 downdip appraisal well, with a planned sidetrack, and will then move to drill the Kodos and Epir (formerly Aze) prospects, which will be the first exploratory wells to test the Kerio Basin, located immediately adjacent to the prolific S. Lokichar basin.

Finally, the Exalo 205 rig is drilling ahead on the Gardim prospect, located in the Chew Bahir basin in the South Omo block in Ethiopia. The partnership is in discussions on the next prospect to be considered for drilling in this block.

National Oil Corporation to back in Blocks 10BB and 13T

The National oil corporation of Kenya will exercise its right to back in 2 blocks in North Western Kenya that have already yielded successful results namely Block 10BB and block 13T operated by Tullow Oil and its partner Africa Oil.

This will be the first time that the industry regulator which doubles as the Kenyan government explorer will back in on any block as the government hopes to play a part in the production of oil and gas that is currently estimated to be over 600mbbl.

This is part of the contract under the production sharing agreement that allows the government to participate should any discovery be made by acquiring some equity on the block in question despite not having invested in exploration.

According to National Oil Corporation managing director Summaya Athmani in an interview with OilNews Kenya the company is yet to discuss internally to agree on what percentage stake it will acquire.

“Under the PSC we have a clause that allows the government to acquire a stake in blocks inside the country should a discovery be made. National Oil on behalf of the government will therefore exercise this right although we are yet to decide on the equity to acquire,” says Athmani.

“Government has elected in that development area. If the Government exercises its option to participate, the contractor (or each entity constituting the contractor pro-rata) shall transfer to the Government that percentage interest specified by the Government. The Government’s participation shall be effective from the date the development plan hereof is adopted,’ reads part of the current Kenyan PSC.

Once the government participation has kicked in shall own and separately take and dispose of its share in the petroleum produced and saved to which the contractor is entitled under this contract in respect to all decisions taken under the participation agreement.

The national oil corporation has announced that it is in the process of setting up the first seismic processing and data visualization center within East and Central Africa.

According to National Oil Corporation managing director Summaya Athmani the center will help handle the increased seismic acquisition in the country and the entire region in general that have in the past seen data flown internationally due to lack facilities.

National oil says the center will be complete by July 2015 and is part of the corporation’s strategy to position Kenya as an African upstream trade and logistics center.

Apart from the seismic center the National Oil Corporation has also announced other projects including the putting up a geochemical and petrophysical laboratory that will provide the wide range of analytical data with the complete furnishing and equipment of this facility expected in Q1 2015.