Tullow looks for partners to develop wells in Kenya and Ethiopia
TULLOW Oil said it plans to secure partners to develop fields in African nations as discoveries prove that future crude exports are viable.
Dublin-listed Tullow together with partner Africa Oil plans to drill about 10 wells in Kenya and Ethiopia this year to explore the Turkana Rift Basin that stretches between the two countries.
Tullow plans to sell part of its stake in five licences in Kenya, chief executive Aidan Heavey said.
"It's never been our intention to stick with 50pc all the way through," Heavey said in London. "It's too much for any company, even a major company."
If local roads were improved, Tullow could start producing from Kenya now, possibly trucking crude to the refinery in Mombasa, he said.
Irish-led Tullow has drilled three wells in Kenya with the first oil discovery at the Ngamia well and the first commercial flow from the Twiga well in the South Lokichar Basin.
The nation may export its first crude at the same time as Uganda, where Tullow is working with Total and Cnoco to develop the Lake Albert fields, Mr Heavey told reporters.
"A few more wells may actually prove it to be a major development" the CEO said. "If that's the case, then the pipeline from Uganda could quite easily go through Lokichar, pick up the oil there" for exports through an Indian Ocean port. "What we are trying to do is to bring in the right type of partners and get them to come up with financing."
Unlike landlocked Uganda, Kenya doesn't require running an export pipeline across other countries, he said. Tullow will bring a fourth rig to the region to accelerate drilling later this year and will increase the Ngamia well resource estimate "quite significantly" following "encouraging" tests.
In West Africa, the company is looking for partners to sell part of its largest stakes in exploration licences in deep waters off Mauritania, Heavey said.
Tullow global oil and gas producing projects generate enough cash to spend about $1bn (€750m) a year on exploration.
"We are focused on building the biggest exploration business around," Heavey said.
Shares in the company rose 1.3pc to 1,022 pence in London. The shares are down almost a third in the last year. (Bloomberg)