By Anthony M. Wanjohi:
Today more than ever before, especially with the new discovery of oil in Kenya, resources exploration has continued to enjoy very strong interest from local and global investors. Kenya is one country which is very well endowed with high quality resources and less volatile political environment that inspires confidence in investment and development. High global oil prices, coupled with a strong market for Liquid Natural Gas (LNG) in the Asia-Pacific region, provides an economic driver for an upswing in exploration in Kenya. Increased demand for energy with the industrialisation of wave in developing economies underpins these market conditions. Kenya’s geographic location ensures it is well placed to meet the rapidly expanding energy needs of the African region among other regions.
The extent of exploration drilling in Kenya is relatively low compared with other regions in the world. With various blocks, Kenya has great potentials in unpacking the hidden mother nature’s secrets. Some of the attributes which make Kenya attractive for petroleum exploration include but not limited to:
- extensive opportunities to explore in prospective basins;
- expanding physical infrastructure, sophisticated technical and services support, and a highly educated workforce;
- an internationally competitive profit-related tax system that recognises the risks of exploration;
- proximity to markets in the growing African economies;
- continuing government initiatives supporting geoscientific mapping of geological features, petroleum occurrences and resources;
- an attractive policy and legal framework for oil and gas development, conducive to companies of all sizes;
- security of title with the right to retain and/or develop a discovery, subject to meeting the specified terms of a retention lease or a production licence;
- transparent, predictable and practical regulatory requirements covering all stages of operations;
- a free market philosophy which welcomes foreign companies
- government facilitation of proposed projects, including fast-tracking of approvals processes for major projects;
- an open and competitive economy, including deregulated banking and foreign exchange arrangements and a sophisticated capital market; and a good record of industrial harmony.
These attributes form the rationale for oil companies to explore oil prospects in Kenya in partnership with other players in the Industry.