Irish exploration company in further significant oil find at Kenya asset

Kenya has moved a step closer to being the next big geographical base for Tullow Oil, after the Irish-founded exploration company made a further significant oil find at one of its assets there.

Tullow has long since tipped Kenya as having the potential to be as big as other areas of Africa — such as Ghana and Uganda — where it has found success.

Yesterday, the London and Dublin-based company said that drilling on one of its onshore exploration wells, in Kenya, encountered 30 metres of net oil pay. The Twiga South-1 well follows on from work on the Ngamia well, where Tullow made Kenya’s first oil find back in March.

“This immediate follow-on discovery reaffirms the considerable prospectivity of the Lokichar Basin. Having significantly expanded our plans in Kenya and Ethiopia, there is much to look forward to as the exploration campaign and testing programme move ahead,” commented Tullow’s exploration director, Angus McCoss.

Analysts noted that the results from Twiga might appear disappointing, at first glance, when viewed against the larger 100 metre find at Ngamia; but also noted that the Twiga drill was at a deeper part of the prospect.

“In other words, this well has effectively tested the extent of the reservoir and allows Tullow to better understand the stratigraphy of the entire basin. This should, therefore, be seen as a positive result with the potential to increase resource estimates for the entire basin,” Barclays Capital said in a research note, yesterday.

Davy Stockbrokers added that the Twiga result “has to give a greater level of confidence that the overall Kenyan play will deliver material upside.”

Tullow’s attention will now turn to exploratory drilling from its 50% owned Paipai-1 exploration well in the same area, results from which are expected before the end of the year.