UPDATE 2-UK's Tullow Oil to resume drilling in Kenya

Thu Nov 7, 2013 8:30am EST

Related Topics

* Government says protesters ransacked site

* Local community demanded more jobs, other benefits

* Tullow to open local field office, hire more locals

* Protest highlights challenge for east Africa explorers

By George Obulutsa

NAIROBI, Nov 7 (Reuters) - Tullow Oil and partner Africa Oil said they would resume exploratory drilling this week in northwest Kenya after reaching an agreement with local leaders to prevent a repeat of protests that halted work last month.

Residents of the remote, poverty-stricken northern Turkana community, supported by a local politician, marched on Tullow operations on Oct. 26 to demand more jobs and other benefits. The government said protesters ransacked one site.

Britain's Tullow said in a statement it would restart work on Friday in blocks 10BB and Block 13T in the Turkana region after "successful dialogue with national and county government and leaders of the local community".

Energy and Petroleum Cabinet Secretary Davis Chirchir told a news conference that under a memorandum of understanding (MoU) between Tullow and Turkana leaders, the explorer would open a field office in Turkana within one month to handle grievances.

"The challenge of employment opportunities is very well articulated in the MoU and issues of disclosure, so that we are all on the same page regarding opportunities that are available, be it in management, in the skilled, semi-skilled or unskilled areas," he said.

The protests highlighted the challenge companies face in managing local expectations of swift returns as they build an oil and gas industry from scratch in Kenya and east Africa, a new region for oil and natural gas exploration.

JOB OPPORTUNITIES

Tullow said the MoU laid out plans for the government, local officials and communities to work together and "ensure that operations can continue without disruption in the future".

Tullow, which says that more than 800 of its 1,400 employees in Kenya are from the Turkana area, said it had reaffirmed its commitment to providing local employment and opportunities.

The government had accused a local member of parliament, James Lomenen, of leading a group of about 400 people to Twiga 1 drilling camp.

It said the group broke down a fence and "engaged in wanton destruction of property and looting" when security officials barred their entry.

Lomenen told Reuters he expected to be charged in court last week in relation to the incident, but the court hearing did not go ahead. He denied incitement and said he welcomed investors but wanted the local community to see more benefits.

Chirchir said the case against Lomenen would be settled out of court in light of the agreement reached.

Sid Black, deputy general manager for Tullow Kenya, said the company expected to take about three weeks to get back to full operation in Turkana, where it had four rigs drilling.

Black said it was too early to give a figure for costs incurred due to the suspension but he described them as "significant".

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