The Kenyan government has settled on Wood Group Plc (WGL) to design the country’s oil pipeline to pump crude from fields in the north of the East African nation to Lamu port. The pipeline which is expected to pump oil for the oil fields in Turkana to Mombasa port is estimated to cost $2 billion.
Kenya discovered commercial oil reserves in its Lokichar basin in 2012 and the 800-km (500-mile) pipeline is expected to be built before production is due to start in 2021/22.
Britain’s Tullow Oil (TLW.L) operates the Kenyan fields, while the other investors are Canada’s Africa Oil (AOI.TO) and France’s Total (TOTF.PA). Kenyan is expected to take a stake through state-owned National Oil.
The pipeline is expected to transport the mine crude oil from Kenya’s Turkana that will be used to export oil once commercial production starts by 2022. Construction of the pipeline is expected to start in 2019 and take two years to complete, in time for the first phase of commercial oil production
In January Tullow Oil said it would undertake production in a phased approach, starting with what it terms the foundation stage, which will involve the production of 210 million barrels of oil from Ngamia and Amosing fields.