FAQ

What is oil exploration?

Oil exploration is the process that involves the efforts of many trained professionals such as geologists, geophysicists and engineers working with both the National and County Governments as well as local communities in search of oil and gas deposits beneath the Earth’s surface.

Why has it taken so long to discover oil in Kenya?

Kenya has had a long history for oil and gas exploration with the first oil well drilled in the 1960s. Despite exploration having occurred for over five decades, only in the last decade has any significant discovery been made. The delayed success may be attributable to historical low pace of exploration in East Africa which was hitherto zoned as an agricultural region with limited exploration activity taking place over the years.

Also, recent technological advancements have allowed Geoscientists to further understand the earth’s subsurface and contributed to the exploration success.

What is the Dutch Disease?

The Dutch disease in an economics term used to refer to the apparent relationship between the increase in exploitation of natural resources and a decline in the manufacturing, services and/or agricultural sector. Simply explained, an increase in the foreign revenues from natural resources will make a nation’s currency stronger compared to that of other nations, resulting in the nation’s other exports (manufactured goods and agricultural produce) becoming more expensive for other countries to buy. This makes the manufacturing, services and agricultural sectors less competitive.

What is the role of the Government in exploration?

Ownership of all Hydrocarbons is vested in the people of Kenya through the National Government. The National Government is the licensor for oil companies and is responsible for regulating and monitoring the sector.

The County Governments have a critical role to play with regards to the field operations of oil and gas companies as they are expected to give access to land and also ensure environmentally responsible operations are conducted. They also form the interface between oil companies and the communities.

Which are the regulatory bodies involved in oil and gas exploration?

All Regulatory functions of the Upstream Oil and Gas industry are vested in the National Government through the Ministry of Energy and Petroleum. The National Oil Corporation of Kenya and other state organs provides support to the Ministry from time to time as required and also hosts the National Data Centre where all historical exploration data is stored.

Who owns the oil and gas once discovered?

According to the Constitution of Kenya 2010 and the Petroleum (Exploration and Production) Act (cap 308), the ownership of hydrocarbons is vested in the people of Kenya through the National Government. The Ministry of Energy and Petroleum manages the resources and all exploration and exploitation contracts on behalf of the National Government.

If oil or gas is found on my land will I be displaced or evicted?

Oil and Gas operations do not ordinarily displace many people as they occupy small sizes of land as compared to the size of reservoirs exploited. It may happen that while oil may be discovered under your land, physical development may be done elsewhere and your land is not disturbed.

If physical development is planned to occupy your land, a specific size of required land will be determined by the oil company and discussions on compensation will be held with you in accordance to the relevant land laws. No land will be taken from you without your consent and compensation.

Will oil exploration affect the health of my family or my livestock?

No.

Well managed operations work to limit the negative impact on people, animals and the environment. Environmental and Social Impact Assessment (ESIA) studies are always done before operations on the

ground are conducted. These must be approved by the National Environment Management Authority (NEMA) prior to any seismic or drilling activities. All risks identified during these studies are adequately mitigated during operations. International Oil companies operating in Kenya are subject to very high Health and Safety standards which oblige them to ensure that human, animal and environmental degradation is avoided at all costs. This is one of the contractual obligations any oil company has with the National Government.

Where can I find information on the oil and gas industry?

Information on the oil and gas is available from the Ministry of Energy and Petroleum. The National Oil Corporation of Kenya website provides a lot of information on the upstream oil and gas industry. You may visit the websites of the two organisations on www.energy.go.ke and www.nockenya.com.

Other sources include the several oil exploration companies who provide regular updates via their websites regarding their exploration activities in the various parts of Kenya, as well as the media and other upcoming information repositories.

How much oil has been discovered in Kenya?

Kenya has had eight oil and gas discoveries since 2012. As mentioned in the oil exploration cycle, Kenya is currently in the appraisal stage in oil and gas exploration meaning that quantities will be established at the end of the process. Estimated oil resources of 600 million barrels have been discovered in Turkana. However, this is still under review and a decision to develop for production has not yet been made. Studies are still ongoing.

Is the oil in Kenya commercially viable?

Kenya is still in the appraisal stage to determine whether oil resources discovered this far are indeed commercially viable. Numerous factors must be considered before the oil discovered is declared commercially viable. It is important to note that exploration activities are still ongoing in other areas, the results of which cannot be predicted until drilling takes place.