Kenyans will finally have the chance to own at least 35 percent of the two oil-producing blocks in Turkana County.
Each of the two blocks in the Lokichar Basin — the 4,719 square kilometre 13T and 6,172 square kilometre 10BB — are jointly owned by British oil firm Tullow (50%), Africa Oil (25%) and Total (25%).
According to Petroleum Principal Secretary Andrew Kamau, the contract for the concession of oil blocks to existing operators has a clause allowing the government to exercise a back-in right, which essentially means buying back a percentage of the ownership before production kicks in.
[caption caption="File Photo at a Turkana Oil Field"]
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“When you sign a contract you have a right to buy back some share, before production.
"The percentage we can buy back is 15 in one block and 20 in the other. The listing should raise enough money for the purchase,” Mr Kamau was quoted by the Business Daily.
Through the listing, Kenyans will have an opportunity to own part of the oil-producing blocks once they are certified to hold reserves, protecting taxpayers from the highly risky initial exploration stage.
The government plans to raise up to Sh103 Billion from the dual listing expected in early 2019, with National Oil Corporation (NOCK) having advertised for a consultant to guide the deal.
PS Kamau added that the proposal was a step in the right direction as Kenya is now firmly on the way to full oil production.
“We are now listing something that is real. The existing operators of the oil blocks are already involved... it is something that is in the contract,” reiterated Kamau.
Earlier this year, President Uhuru Kenyatta clashed with Turkana Governor Josephat Nanok over how oil revenues should be shared between the national and county governments.
Nanok demanded that 30 percent of the revenues earned by the State should be shared between the county and local community while the President stated that the local community should be entitled to only 5 percent, while the county should get 20 percent.
[caption caption="Turkana Governor Josephat Nanok"]
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