Kenya to go ahead with the pipeline plan despite the fall of oil prices
Kenya is in a move to build a pipeline worth Sh121.45 billion from Lokichar to Lamu in an attempt to boost oil exports despite the clear fall of oil prices in the global market.
According to estimates, the State Department for Petroleum is set to spend another Sh777.5 million for research, feasibility studies, project preparation and design for the project. Also, another Sh 648.5 million for the next financial year starting July 1 on the oil pipeline (project S).
The pipeline construction is expected to be complete in the second half of 2023 and not June 2022.
“We can conclude the award to EPC (Engineering, procurement and construction) contractor in the second or third quarter of the year and begin construction then,” said Andrew Kamau, Petroleum PS.
The project is in a joint partnership between the Kenya government and oil companies’ consortium of Tullow Oil Kenya B.V, Africa Oil Turkana Ltd and Total Oil.
Experts believe for such investments to be supported the international price of oil need to rise above $50 a barrel. In the recent sales, the price per barrel has hit below $30 (ksh3000) which has raised concern over the viability of a capital-intensive infrastructure for the country.