Major Beneficiaries of Kenya’s Early Turkana Oil Production

A number of Kenyan investors and foreign experts are expected to join the millionaire and billionaire clubs soon after transportation of oil from Turkana Oil Fields begins next month.

Multi-national companies owned by prominent individuals will be among the major beneficiaries of the early oil mining even before commercial production commences in three years’ time.

The Business Daily reports that companies that will form the first lot of oil barons comprise of Oil Transporters, Simmons and Simmons Law Firm, the government of Kenya and Nairobi Based companies - KK Security, Phoenix Aviation, and TransCentury.

2,000 barrels of oil will be transported daily, one truck can only carry 200 barrels of oil (31,800 litres). This means 10 trucks will be leaving Lokichar every day for the port of Mombasa, promising a potential goldmine for motor dealers with the capacity to quickly buy and import the vehicles.

Simmons and Simmons Law firm was enlisted by the Kenyan Government to come up with the export plan that is worth millions of dollars. The deal makes the law firm another big beneficiary of the early oil production.

The Kenyan government will also benefit largely from the annual surface fees that oil explorers pay per kilometre of exploring oil blocks. Previously the government has been earning Sh503 Million but the amount is set to increase after the government licensed more exploration blocks.

Phoenix Aviation company is another major beneficiary of the early production. Tullow staff have been flying Phoenix’s chartered planes at an estimated cost of Sh612,000 for its chartered 8-seater King Air BE350 aircraft from Wilson Airport in Nairobi to Turkana.

TransCentury company owned by former President Mwai Kibaki’s allies is also a major beneficiary as it has built a total of seven exploration well pads in Turkana, making it one of the biggest beneficiaries of the new oil wealth. The contracts also included building of access roads to each well pad and a bridge in Kainuk area of Turkana.

Local security firm KK is also a major beneficiary as it signed a lucrative contract with Tullow to offer security, accommodation, and logistical services.

Small traders in Turkana will also benefit as demand for accommodation, fresh foods such as meat, vegetables, bottled water, fresh fruits as well as vehicle repair, welding, construction materials and fuel supply increases.

Tullow, however, declined to provide a breakdown of the payout to individual contractors, citing contractual obligations.

The first barrel of Turkana oil is expected to hit storage tanks in Mombasa next month.