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Archive for March 26th, 2012

Will it be a curse or blessing for Kenya?

Posted by Administrator on March 26, 2012

By Tim Wanyonyi

With the discovery of oil, Kenya is at a crossroads where it must take the highway to heaven or hell.

Imagine a country with a massive National Petroleum Investment Fund in which proceeds from oil sales are saved.

Profits from the fund are paid out as dividends to all Kenyans in the form of free education, health care, public infrastructure projects and stipend for the poor and jobless. Petrol is cheap and readily available.

Now flip the coin and imagine a country where petrol shortages are the order of the day, whose soils and water have been poisoned by leaks and whose politicians compete to steal oil revenue with impunity.

Worse still, unemployment is high and hundreds of people are regularly  burned in fires as they puncture pipelines in suicidal attempts to get a share of the oil.

Many countries in the world which have struck oil have been cursed with corruption, greed and political strife.

In Africa, Nigeria is the biggest  example.

The continent’s  leading producer has earned hundreds of billions of dollars from oil revenue since it was discovered 50 years ago yet a majority of its people are some of the world’s poorest.

Revenue from the resource is stolen by its rulers, both military and civilian. Whenever elections are called, oil money is used to steal them.

In the Delta region, where the oil is extracted, there is 90 per cent unemployment.

Today, Nigeria, despite its oil wealth is a country in danger of breaking apart because of tribal and religious unrest.

In Russia, the oil boom mostly enriched oligarchs. But the quality of life in Russia continues to deteriorate.

Saudi Arabia is the world’s biggest producer yet oil revenues tend to flow into the bank accounts of the royal family. Unemployment is at 25 per cent and the kingdom still resembles a poor third world country.

These are the countries that have been afflicted by the oil curse. Instead of this black gold helping them improve the quality of life for their people, it has caused suffering.

But not all oil producing nations are cursed and Kenya has a chance to choose which way to go.

Norway, a country of  nearly five million people is one great lesson on how to invest oil money. It has set up a fund that currently has an excess of $150 billion and is growing rapidly.

The Norwegians, the world’s third biggest exporters behind Saudi Arabians and Russians, have proven that oil doesn’t have to be an obstacle to stability and long-term growth.

The Petroleum Fund of Norway was set up in 1990 to function as a fiscal shock absorber. According to a BBC documentary, it is run under the country’s Central Bank and converts petrodollars into stocks and bonds.

But instead of paying dividends, it uses revenues and appreciation to ensure the equitable distribution of wealth across generations.

The key to getting the best from oil is getting the politics and governance right. Countries ruled by tribal kingdoms, authoritarian regimes, kleptocracies and military dictatorships have tended to misuse national oil revenues.

On the other hand, countries where there is democracy and more openness in the running of public affairs  do better.

In this regard, Kenya, with one of Africa’s most democratic constitutions, has a headstart.

It should be better off than Uganda, for example, where Yoweri Museveni is calling all the shots in the oil sector. But then again, Kenyan politicians have proven to be some of the most corrupt on the continent.

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Ugandan top ministers took bribes from Tullow oil – parliament told

Posted by Administrator on March 26, 2012

Uganda’s Prime Minister, Amama Mbabazi and two other ministers were on Oct.10 have allegedly benefited from bribes from oil companies, parliament heard yesterday at a critical debate about the country’s nascent oil sector.

A jam parked parliament that had been recalled from recess heard that Mbabazi, Sam Kuteesa, the minister for foreign affairs and Hillary Onek, the minister for internal affairs allegedly benefited from billions of bribes from oil company, Tullow Oil Plc.

 

The allegations were made by MP Gerald Karuhanga who tabled a document Brief on Uganda’s Oil deals in which alleged details of dates and transactions through which the bribes were paid.

Karuhanga said he was in parliament to act like a whistle blower. He was presenting a motion prayer number 4  of a motion by Rwemiyaga MP Theodere Sekikubo that seeks to set up a commission of inqiuiry to investigate the officials that have been given kickbacks from the oil players.

Here is what MP Karuhanga told parliament;

Kutesa

•             Kutesa through his company East African Development company Kenya received €17m (over Shs.70bn)through his bank called EFK in Zurich. The money was leaving a Tullow account 40037242019 in a bank in Malta…through a recipient bank in UAE Dubai

Following this Kutesa requested a point of order which the speaker Rebecca Kadaga granted him.

“Karuhanga has alleged that I received money through my company called East Africa Development and that the money went into an account that belongs to me in Zurich,” he said amidst jeers and heckling by the enraged MPs. “Is it in order to use this House and the privileges it attaches to members to tell falsehoods and utter defamatory statements which are false well knowing that he can’t repeat them outside this chamber?”

Kutesa also said that the documents Karuhanga was relying on were forged, have been making rounds in this city and that he had some of them. A charged Karuhanga challenged Kutesa to table the documents he had and said that he could repeat the statements he was making outside the chambers.

Onek

•             Showing bank statements, Karuhanga said that Onek on June 21,received  € 500,000 from Tullow on account 4003724191 from the same back to Dubai

•             another € 500,000 on his account 0034450627007 in a Dubai bank on July 6,

•             another €500,000 same bank on July 17, 2010

•             Onek received  €1.5m on the same account same day.

•             And another €3m on the same account on August 10, 2010

Mbabazi

Karuhanga said that an officer of the American Embassy wrote that Tullow VP for Africa indentified the security minister then Mbabazi, and Energy Minister Onek benefited from Tullow. Karuhanga adds that various embassies wrote to Museveni calling for investigation of ministers like Mbabazi and Onek. Judge Billy Kainamura, Deputy Secretary to the Treasury Keith Muhakanizi are also on the list of alleged beneficiaries.

MP Barnabas Tinkasimire thanked Karuhanga giving such information and spilled more information. He said: “there is a man called John Molley who is a truck driver in the oil fields, running a company called SLL that manages and controls the constriction of the camp, where each worker is charged $ 92 – 95 to live in that camp. I understand he has a very close relationship with the Hon Minister seated in front of me here- his name is Sam Kutesa.” Tinkasimire also faulted Onek for influencing the employment of three of his relatives in the oil Tullow.

Kutesa and two other ministers including former Ministry of Works and now NRM chief whip John Nasasira are set to appear before the Anti-Corruption Court on Oct.13 over other corruption charges relating to the misuse of Shs14 billion in Common Heads of Government Meeting (CHOGM) funds.

Source: http://independent.co.ug/News/news-analysis/4716-ugandan-top-ministers-took-bribes-from-tullow-oil-parliament-told

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Irked that Uganda is losing billions in exorbitant Tullow oil expenses, MPs want oil deals halted

Posted by Administrator on March 26, 2012

Members of Parliament want government’s oil deals halted after it emerged that Tullow Oil, a company at the helm of the country’s potential 6bn barrels is making extravagant expenses that the  government has to meet before it starts reaping from the oil.

Agreements reached with the oil companies indicate that before the government takes its share of the oil, the oil companies have to first recoup their expenses incurred during the oil exploration process.

Rwemiyaga MP Theodere Sekikubo who tabled the motion calling for halting of all oil deals told parliament on Oct.10 that Tullow officials were paying themselves exorbitant salaries at the expense of Ugandans who are set to meet all these costs when production of oil starts and before the government starts getting its share.

On Sekikubo’s list is a caterpillar driver with a certificate in catering who bags Shs.54 million, another worker with a certificate in catering gets 36 million and a security boss who also gets 44 million per month.

The MPs also heard that Tullow oil allegedly spent $ 39 million on one oil well Ngassa and spent another $ 5 to fix it.  Sekikubo also told MPs that the government will have to meet a whopping $120,000 per day for rigs which were brought by the oil companies and left to lay idle. “Companies will have to recoup all these costs before the government can start getting its share of revenues,” Sekikubo told parliamentarians.

According to the documents all the workers were spending $92 – 95 ( about Shs.250,000) on accommodation per night and $ 100 ( about Shs.280,000) on every meal. Going by the current dollar rate the government of Uganda would have to pay about 2.7bn for every worker’s accommodation and over 3 bn for their meals per annum. This translates into Shs 5.7bn on every workers meals and accommodation per annum.

Sekikubo added that 70 percent of these employees were foreigners and that local Ugandans are not benefiting at all since all the goods and services the oil companies bought in Kampala and imported. Most of the money from contracts of services to oil companies goes to powerful politicians and their relatives, Sekikubo told parliament.

For instance a parking yard used by the oil companies and located in Kampala instead of western Uganda where the oil is located is owned by the Prime Minister Amama Mbabazi’s daughter Nina Mbabazi and her husband Mathew Rukikaire.

Sekikubo noted that while Uganda had up to 3bn barrels in oil with a potential of over 6 billion barrels going by the exorbitant expenses of the oil companies, Uganda was likely to lose a lot in recovering these expense yet the oil has immense potential to transform the country.  With just a billion barrels, Sekikubo said, Uganda would make $ one trillion enough to fund the country’s Shs 8 trillion budget for a number of years.

Demands

To avert this situation, Sekikubo’s motion, seconded by FDC’s Abdul Katuntu (FDC), MP Gerald Karuhanga and Wilfred Niwagaba is calling for immediate halting of oil deals and all contracts until parliament passes an effective the National Oil and Gas Policy. But the government has to first disclose all the revenues received from oil deals, the MPs demand.

The motion also demands that that the government tables all the relevant Bills within 30 days and reviews the Production Sharing Agreements and sets up a commission of inquiry to investigate ministers that allegedly received bribes from oil companies especially Tullow oil.

Tullow oil is set to farm down its stake in the Albertine region oil fields to Total and China’s CNOOC on Oct.15, but the MPs are demanding that this too be halted and that the government explains how it procured foreign lawyers in the Heritage Oil case.

Nyombi fails to stop the debate

Attorney General Peter Nyombi had moved under rule 60 of the Rules of Procedure of Parliament, to object Sekikubo’s motion saying that while government was willing and ready to discuss the issues raised in the motion, its grounds presented subjuce issues.

But the speaker of parliament Rebecca Kadaga powered cold water on Nyombi’s claims saying that Sekikubo had been so careful not to touch matters in court. Shadow Attorney General, Abdu Katuntu was one of the five MPs that seconded sekikubo’s motion.

Katuntu faulted Nyombi of absconding from duty saying that had he done his duty they would not be there and urged him to stave off legal engineering in national matters. He also likened government officials that had taken kickbacks from oil companies to fore-fathers who he said “sold this country because they were given small things like hunting spears, but some people studied history to pass exams”.

Source: http://www.independent.co.ug/ugandatalks/2011/10/uganda-losing-billions-in-exorbitant-oil-company-expenses/?Itemid=410

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Kenyan man found critically injured on a road in Arizona

Posted by Administrator on March 26, 2012

SAN TAN VALLEY, AZ – Sheriff’s deputies are searching for a suspect or  suspects after a young man was found critically injured on a San Tan Valley  street early Thursday morning.

Pinal County sheriff’s officials say deputies were called to the intersection  of Desert Honeysuckle and Desert Rose Trail in The Greens neighborhood in San  Tan Valley around 2:30 a.m. after a man was discovered lying in the road.

The victim, who has been identified as 22-year-old Peter Mwangi of San Tan  Valley, was unresponsive, according to officials.

Mwangi suffered severe trauma to the head and there were vehicle tracks going  over his body.

Evidence shows Mwangi may have been the victim of an assault, but the initial  report of a hit-and-run has not been ruled out, officials said.

The victim was flown to Scottsdale Osborn Hospital where he remains in  critical condition.

There were no witnesses to the incident, but sheriff’s deputies are asking  for anyone with information that could help identify the suspect or suspects to  contact the Pinal County Sheriff’s Office at 520-866-5111.

Source: http://www.abc15.com/dpp/news/region_southeast_valley/queen_creek/young-man-found-in-critical-condition-after-hit-and-run-in-san-tan-valley#ixzz1qHbvANUj

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Police executed 800 men, Truth team told

Posted by Administrator on March 26, 2012

Police have executed more than 800 people through extra-judicial killings in the last five years.

Between 2007 and 2008, about 500 people were executed due to links with the outlawed Mungiki, former Kenya National Human Rights Commission (KNCHR) commissioner Hassan Omar claimed.

Mr Omar, who was testifying before the Truth Justice and Reconciliation Commission (TJRC) on Monday,  said after the KNCHR  raised a red flag, police devised new ways of carrying out the killings.

He said people would disappear from their homes never to be found again or would be found dumped at the City Mortuary or on roadsides.

“Families that searched for their loved ones in police cells would be told to go away never to come back or they would disappear like them,” Mr Omar said.

Police would strangle the Mungiki members or drown them in rivers and create an impression that the deaths were caused by leadership rivalry.

“Because gun shots would easily unmask their extra-judicial killings, they resorted into killings where suspects’ bodies would disappear for good,” Mr Omar told TJRC commissioners Tecla Namachanja, (retired Maj)   Ahmed Farah, Berine Dinka and Margaret Shava.

He told the truth team that last year alone, 60 suspected criminals died due to extra-judicial killings.

Mr Omar claimed at one time his life was in danger for raising the issue. According to him, lawyer Oscar Kingara and his assistant Paul Oulu, who were advocating against the killings in 2009, were killed by the police.

Mr Omar said former police officer Bernard Kirinya in 2008 provided the commission with information on how the force was carrying out extra-judicial killings but was snatched from their protection and killed.

“While he was still seeking United Nations asylum, which usually takes about two years, he was killed and police never investigated his death,” he said.

Ms Alice Wambui, whose husband Samwel Mwaniki was a suspected Mungiki member, told the commission he was arrested and taken to Kabete Police Station but the officers there denied this.

After several weeks of searching, she went back to Kabete and the station boss told her never to return lest she wanted to disappear like her husband.

“He told me to go and take care of the children or I also disappear like Mr Mwaniki and leave our children orphans,” she told the commission in tears.

Source: http://www.nation.co.ke/News/Police+executed+800+men+Truth+team+told+/-/1056/1374308/-/1afqcaz/-/index.html

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Kibaki to Snub UK Minister Over ‘ICC Plot’

Posted by Administrator on March 26, 2012

President Mwai Kibaki will likely not meet visiting UK Minister for Africa Henry Bellingham following the furore over documents presented in Parliament three weeks ago. By yesterday there was still no confirmation from State House of any meeting scheduled between Kibaki and Bellingham. “(I have) not been informed of any but will let you know if one is scheduled,” Isaiah Kabira, the head of the Presidential Press Service, said yesterday when asked about any appointment with Bellingham.

Foreign Affairs assistant minister Richard Onyonka said he was not aware of a scheduled meeting between the President and the visiting UK minister. “We have no confirmation whether the UK minister will be meeting the President and on what subject if any,” the assistant minister said. Details of the minister’s schedule remain fuzzy with the British High Commission in Nairobi declining to discuss them. “We are not permitted to discuss the details or his itinerary due to security reasons,” the High Commission’s spokesman John Bradshaw said. Bellingham is set to meet with business leaders in Mombasa, which will be his first stop.

Yesterday an email was circulating, said to be from the British High Commission, which invited Kenya Private Sector Alliance CEO Carole Kariuki for a lunch meeting with Bellingham on board the HMS Westminster at the Coast. We, however, could not ascertain whether the email originated from the British High Commission.

The email allegedly written by the PA/British High Commissioner Peter Tibber, Miss Emma Rowney, on March 21 states: “The theme of the lunch is to discuss how to improve the port efficiency and opportunities for UK companies. We are not aware yet which berth HMS Westminster will be at but on arrival at the Port entrance you will be directed towards the ship (as long as you have your invitation and photo ID)”.

Nearly three weeks ago, documents were tabled in Parliament alleging the UK was planning to have President Kibaki indicted by the International Criminal Court at the Hague and Deputy Prime Minister Uhuru Kenyatta and Eldoret North MP William Ruto arrested in April. The documents have caused diplomatic concerns. They were tabled on March 8 by Yatta MP Charles Kilonzo, who has maintained that they are authentic. A day later, a source at the Ministry of Foreign Affairs – who requested anonymity due to the sensitivity of the matter – told the Star that the NSIS knew of the existence of the letters and had confirmed that they were fake.

A parliamentary committee is investigating the origin and the authenticity of the same. The UK government has said the documents were forged, and a smear campaign aimed to destabilise the bilateral relations with Kenya and to damage the political atmosphere ahead of Kenya’s elections. At the same time, Foreign Affairs minister Moses Wetang’ula told the Parliamentary Defence and Foreign Relations Committee that the “National Security Intelligence Service urges caution” over the authenticity of the alleged diplomatic documents.

In an op-ed appearing in The Star last week, Bellingham said his visit had nothing to do with the alleged documents. “I know there has been much speculation about the purpose of my visit. As I have made clear above, it is because of the many shared interests between the UK and Kenya, and other regional interests,” Bellingham wrote on Saturday.

He said the visit was another in a regular succession of ministerial and other senior visits to Kenya over the last few years that had been planned for several weeks and was not in response to the alleged documents presented in Parliament. One such high profile meeting involved President Kibaki with UK Prime Minister David Cameron on the sidelines of the London Conference on Somalia on February 23.

“For the record, the documents are not genuine and I have no intention of giving them any credence by commenting further. I am concerned that, among other preposterous allegations, His Excellency the President and the Right Honourable Prime Minister were dragged into this as part of an attempt to cause division and instability, just when Kenya needs a stable and peaceful environment to conduct fair elections and implement the Constitution. The heightened tensions from the political rhetoric on all sides are of concern, and we support those who are calling for restraint,” the UK minister said.

Source: http://allafrica.com/stories/201203261827.html

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Kanu plans Uhuru ouster over The Hague trial

Posted by Administrator on March 26, 2012

A supporter of Finance minister Uhuru Kenyatta holds a poster during a solidarity walk through Gatundu town, north of Nairobi

A supporter of Finance minister Uhuru Kenyatta holds a poster during a solidarity walk through Gatundu town, north of Nairobi

The Independence party Kanu is set to hold a Special National Delegates Council (NDC) meeting on Friday where radical changes in the party leadership structure and operations would be unveiled.

The meeting comes as national chairman Uhuru Kenyatta is under attack over last week’s statement that he needed a month to make public the party he will use in gunning for the Presidency in the next polls.

Uhuru said during a Gema meeting in Limuru that he was consulting with various leaders from different regions before making the announcement.

“Being the Kanu chairman, Uhuru should have seized the opportunity to popularise the party. His lack of commitment has raised concern among members who are seeking direction and they expected the chairman to provide leadership,” said Secretary General Nick Salat.

Salat said Kanu would go it alone in the next general election and that aspiring candidates for the Presidency, Parliament, Senate, Gubernatorial, Women and County representatives should prepare for the nomination process.

NEC member Ahmed Bafadhil said he would ask Uhuru during the NDC meeting to step aside as the party chairman pending the determination of a case facing him before the International Criminal Court (ICC) over the 2007 post-election violence in the country.

Warnings

“I have received opposition following the position I have taken but nothing will deter me from exercising my democratic right as a party member,” Bafadhil said in a statement on Monday.

Uhuru is expected to be put to task over his association with PNU Alliance without the authority of the party organs.

During a retreat in Naivasha in December, last year, Uhuru was put to task by NEC and Parliamentary Group members for failure to hold consultative meetings with officials to address various issues.

But after the heated meeting, Uhuru, Vice Chairman Gideon Moi, Secretary General Nick Salat and other officials announced the differences had been ironed out and a road map to revitalize the party had been laid out.

“We need to focus on revamping the party and comply with constitutional provisions. The party should play a leading role in the elections,” said Uhuru.

Gideon said: “We are going to hit the ground running as we seek to make the party a formidable outfit.”

Uhuru has said Kanu will conduct recruitment drives across the country and field candidates in all levels.

A revised party constitution will be tabled before the 4,200 delegates from the 47 Counties and the party’s Parliamentary Group members of 15 MPs.

The meeting also seeks to comply with the new Political Parties Act, the Election Act and the Independent Electoral and Boundaries Commission Act among other legal provisions.

The last time the party held NDC was in 2008 to comply with the Political Parties Act.

Proposals to change the party name to Kenya Alliance National Union on the grounds the word “African” was discriminative was rejected by NEC members.

“The party shall remain a corporate body with a common seal and shall have perpetual succession and may sue and be sued,” the revised constitution states.

Life membership has been abolished and in its place, Gold and Ordinary categories created.

Decision to scrap life membership was informed by the fact that some politicians including President Kibaki, Prime Minister Odinga, Vice President Kalonzo Musyoka and Deputy Prime Minister Musalia Mudavadi – have not denounced their membership.

Membership

Gold card is renewable every 10 years while both Ordinary is renewed yearly.

“The rules are that all the national officials must be Gold card holders as they will be in office for five years,” a NEC member said.

Every member of the party according to the revised constitution shall demonstrate allegiance and loyalty to the country’s constitution and that of the party and its leadership. A member is allowed to terminate membership at anytime provided he/she gives written notice to the Secretary General, subject to the provisions of the Political Parties Act on termination of membership of a political party.

The streamlined leadership structure has seen the reduction of vice chairmen from four to two while for the other positions there shall only be one assistant.

The positions are – National Chairman, First and Second National Vice chairmen, Secretary General, National Treasurer will have one deputy each.

The National Organizing Secretary, however, will have two deputies – one in charge of programmes and training while the other is in charge of branch operations.

The position of Director of Elections has been scrapped and replaced with the National Election Board (NEB).

The party will have a Policy Advisory Council consisting of seven secretaries – Secretary for Administration of Justice and Legal Affairs, Secretary for Public Policy and Economic Affairs and Devolution, Secretary for Media Relations, Secretary for Environment Wildlife Conservation and Tourism, Secretary for Education, Research and Technology, Secretary for International Affairs, Secretary for Labour and Industrial Relations.

New structure

In line with the new structures of devolved government, the position of Provincial representative has been scrapped and the new structures starting at the bottom with polling station, ward, sub branch (constituency) and branch (County). Members of the County Assembly will sit at the branch level.

“Being a political party, we are trying to move away from the usual government administrative structures like locations and sub locations, and adopting one based on electoral units,” Justice Muturi, the national Organising Secretary said. Powers initially vested on the chairman have been reduced and given to various organs of the party.

The chairman has full authority and will provide policy guidance to the various organs in the party. He/she will attend all caucuses of the party.

Property disputes

The Secretary General will head the secretariat and the Principal Accounting Officer.

Kanu Foundation has also been scrapped in the revised party constitution, which seeks to embrace professionalism in its management structures.

Properties spread across all parts of the country, which have been under the management of trustees and branches, will now be directly owned and managed by the party headquarters.

Dispute over ownership and management of party properties has been persistent over the years with some of the trustees having moved to other parties.

“In Nyeri for example, President Kibaki remains a trustee of the party property alongside the late Isaiah Mathenge and Munene Kairu.

Source: http://www.standardmedia.co.ke/InsidePage.php?id=2000054991&cid=4&

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Excitement as Tullow strikes oil in the first well in Turkana county

Posted by Administrator on March 26, 2012

Photo/STEPHEN MUDIARI Minister for Energy Kiraitu Murungi lifts a bottle containing crude oil during a press conference at Nyayo House in Nairobi, March 26th, 2012. The minister announced that oil has been discovered in Turkana county.

Photo/STEPHEN MUDIARI Minister for Energy Kiraitu Murungi lifts a bottle containing crude oil during a press conference at Nyayo House in Nairobi, March 26th, 2012. The minister announced that oil has been discovered in Turkana county.

Kenya has discovered oil in Turkana in what is seen as a significant breakthrough in its exploration efforts.

The oil was found by Tullow Oil Plc, a British firm, which is also drilling in Uganda and termed the find beyond its expectations.

President Kibaki said the discovery was a major step towards making Kenya an oil producer.

“This is, however, a major beginning of a long journey to make Kenya an oil producer, which typically takes in excess of three years,” said the President during the announcement of the evaluation results of the performance of public agencies for the financial year 2011/2011 on Monday.

Tullow sunk only one well and made the discovery at Kodekode village in Nakukulas location in Turkana East District.

The company has been has been working on Block 10BB in Ngamia-1 Well and struck oil at a depth of between 846 and 1,041 meters. The company has a licence to prospect in five other blocks covering over 67,000sqkm (six times the size of the licences in Uganda).

“The oil that was discovered in Uganda is much lower than what has been discovered in Kenya,” Energy minister Kiraitu Murungi said, speculating that the deposits could be more than the hundreds of millions of barrels discovered in the neighbouring country.

The Energy minister was addressing journalists at the sidelines of the performance contracting event in Nairobi.

However, at a press conference later in the evening, Mr Murungi said the company will continue with the exploration in the next three years to find the right amounts that will make the oil find viable for commercial production.

“Over 10 similar prospects have been identified within this Rift sub-Basin and these initial results are encouraging for future drilling activities. More exploratory wells and seismic data are required to establish if the Ngamia-1 discovery will be of any commercial significance,” Mr Murungi said.

“Oil is a very expensive business venture and we therefore need hundreds of millions of barrels to be able to make it commercially viable,” said Mr Tim O’Hanlon, Tullow Oil’s Vice President for African business.

Kenyans will also have to wait longer to see their first processed oil. Uganda expects to start refining crude oil from its fields in 2014, eight years after it discovered it. It found oil deposits in 2006 in the Albertine basin along its border with the Democratic Republic of Congo and reserves of about 2.5 billion barrels have been confirmed.

Mr Murungi said the discovery comes after a frustrating search.

“Tullow has confirmed that Ngamia-1 exploratory well encountered in excess of 20 metres of net oil pay,” Mr Murungi said.

At least 31 dry wells have been dug in various parts of the country, including Isiolo and Lamu. The ministry has issued 38 blocks for exploration.

“The search was Tullow’s first exploration in Kenya. We invited them last year and they told us the rock structure in Turkana was similar to the one in Uganda,” said Mr Murungi.

The news excited financial markets in Britain after Tullow Oils shares strengthened 4 per cent last evening.

This comes at a time when Kenya has increased its activities in exploration after natural gas was found in Tanzania and Mozambique.

“Immediately Uganda found oil, we knew that we were not far from it. With this find, we will now intensify activities in the blocks that we have to allow us join the league of oil producing nations such as Libya, Abu Dhabi, and Iran,” Mr Murungi said.

Oil is Kenya’s largest import item. It is the main factor that was blamed on last year’s depreciation of the shilling and the country’s widening import bill that has put pressure on the current account.

Commercialisation will be a major relief for the Central Bank of Kenya, which has been under pressure to keep the shilling stable despite a widening trade deficit.

Mr Murungi also revealed that his ministry was revising the Petroleum Exploration Act to ensure that revenue sharing was in line with the Constitution. He said the ministry had sent staff for training in the countries that have made similar discoveries to prepare them for mass production.

“We are well aware of the curse that comes with oil discoveries. For us in Kenya, we want it to be a major blessing. This will only happen if we ensure that both the interests of the community that the find is made, the national government and the discovering company are taken on board,” Mr Murungi said.

In a statement, Tullow Oil said the oil find was beyond their expectation.

“This is an excellent start to our major exploration campaign in the East African rift basins of Kenya and Ethiopia,” Mr Angus McCoss, the company’s Exploration Director said.

“To make good oil discovery in our first well is beyond our expectations and bodes well for the material programme ahead of us. Tullow is working closely with the Government and people of Kenya as a committed long term partner to unlock the oil potential of the region,” added Mr McCoss.

He went on; “We look forward to further success as seismic and drilling activities continue to gather pace.”The company said the discovered oil had similar properties to the light waxy crude discovered in Uganda.

“The well, located in the Turkana County of Kenya Block 10BB, was drilled to an intermediate depth of 1,041 metres and has been successfully logged and sampled.”

Moveable oil with an API greater than 30 degrees has been recovered to surface.”

The company said the Ngamia Well was the first prospect to be tested as part of a multi-well drilling campaign in Kenya and Ethiopia.

“Many leads and prospects similar to Ngamia have been identified and following this discovery the outlook for further success has been significantly improved,” the firm added.

Source: http://www.nation.co.ke/News/We+have+found+oil+says+Kibaki+/-/1056/1374314/-/uq5xt2/-/index.html

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