Kenya has yet again delayed approving the plan for commercialisation of the Turkana oil fields to December 31, 2025 after Tullow Oil sold the project rights to Gulf Energy.
Commissioner for Petroleum Joseph Otieno said that six-month extension from the initial deadline will allow Gulf Energy to review the field development plan (FDP) of the fields located in the South Lokichar basin. But this could potentially further delay Kenya's dream of becoming an oil-producing economy.
The government’s decision on the FDP that was submitted by Tullow Oil was set for June 30, 2025 but the entry of Gulf Energy changed the plan’s review period, with the firm being given time to scrutinise the FDP and adopt or amend it.
This is the third time that a decision on the FDP has been delayed and raises concerns that the country might have to wait beyond 2026 to start commercial production of oil.
Energy Cabinet Secretary Opiyo Wandayi recently said Kenya would start commercial production of oil from the South Lokichar fields by the end of 2026.
Gulf Energy acquired the project from Tullow Oil for $120 million (Sh15.5 billion at current exchange rates). The deal marked Tullow’s stay of over 13 years in Kenya since it discovered oil but endured hurdles in the quest to start commercial production.
“There was a request from Tullow Oil for extension of the review period by six months and so a decision is now expected on December 31, 2025. It is fair that we (government) give Gulf Energy enough time to review the plan and agree to it or propose changes before the government makes its decision,” Mr Otieno told this publication.
The entry of Gulf Energy sparked concerns that approval of the FDP could be delayed in the event that the firm chose to submit a fresh one or significantly alter the current FDP. The former could have triggered fresh delays on the government side in deciding on whether or not to proceed with the commercialisation plan of the oilfields.
Tullow submitted the initial FDP in 2021 and a government’s decision was set for June 30, 2024. This was however pushed forward by a year after the government cited technical and financial gaps in the plan.
“As part of the process, we have to let Gulf review the FDP because they are the ones who are expected to implement it.”
Tullow submitted a fresh FDP in March last year. The government then tapped three consulting firms to review it.
Gulf Energy acquired the project from Tullow in April 2025, less than two months before the government’s set deadline of June 30, 2025 to decide on the FDP.
Tullow discovered commercially viable oil in blocks 10BB, 13T and 10BA in South Lokichar in 2012 but faced hitches in efforts to start commercial production. The hurdles were a combination of lack of an investor to de-risk the project and delays in getting the government’s approval of the FDP.
Former CS for Energy Davies Chirchir in 2023 told Parliament that Kenya needed $3.4 billion (Sh439.46 billion at current exchange rates) to unlock the oil reserves.
The billions would be for drilling commercial wells, building storage tanks in Turkana and a crude pipeline to the port of Mombasa, to get Kenyan oil to the global market.
Tullow unsuccessfully tried to persuade investors to bankroll the project, with the last such attempt being a pitch made to a consortium of the Indian Oil Corporation (IOC) and Oil and Natural Gas Corporation’s ONGC Videsh in 2022.
