The newly gazetted deep water blocks are already up for grabs. The eight blocks for leasing were listed in March this year.Camac Energy and France’s Total have already signed production sharing contracts with government.
Camac, an American firm was the first explorer to license any of the new offshore blocks. It has secured two blocks namely, L27 and L28 both in Mombasa. Other blocks it has secured are L1B-onshore and L16 which straddles land and sea.Camac owns ninety per cent of all the blocks while the rest is government thus making Camac the operator of the blocks.
Total, well known for risky deep water drilling, signed for block L22.They signed a heads of agreement with the government in July last year but are reported to have purchased the area data last month.
Normaly, the government delineates the boundaries after deciding were the blocks will be and then licenses the blocks. Among the companies offered the offshore blocks by the ministry of energy include Brazil’s Petrobras,Noway’s Statoil and Eni of Italy .However, they are yet to sign the agreements.
Oil search deal with Japanese firm…
Government owned National Oil Corporation of Kenya (NOCK) has entered into a joint venture with Japan Oil, Gas and Metals National Corporation (JOGMEC), a Japanese firm to jointly survey for hydrocarbons in the country. They will conduct a geophysical survey which helps in evaluating if there are commercially viable hydrocarbons in prospected sites.
Geophysical surveys are important to exploration companies as they determine which areas more are like to give a successful drilling operation. Currently, there are a total of 46 exploration blocks up for grabs in the country eight of which are offshore as gazetted by the government.
The two firms’ first joint venture will be to survey block 14T, in June this year. The deal which underlines the interest of international oil companies will run for an initial one and a half years. Though they do not have immediate plans to drill on the block, NOCK says they will complete the 2D seismic surveys as well as the electromagnetic studies.
Kenya has shown great possibility of producing oil following Tullow’s oil discovery at the Ngamia 1 block in Northern Kenya. They recently indicated that the oil thickness of the oil reservoir was greater than initially expected and only the most shallow depths of the planned well had been drilled.
Joint ventures are considered by exploring companies following the high cost of survey and drilling.Onshore exploration can attimes get upto $50 million