July 17, 2018 / 2:20 PM / a month ago

Tullow Oil may halt Kenyan oilfield operations due to protest

NAIROBI (Reuters) - Britain’s Tullow Oil said on Tuesday that it might be forced to shut down operations at its northern Kenyan oilfields if it cannot reach a deal to end protests by the local community that have disrupted activities to truck oil from the area.

The protests, which began on June 27, interrupted a trucking scheme that aims to transport about 2,000 barrels per day (bpd) of crude from northern oil fields to the coast. The pilot scheme was launched in June.

The oil is being used to test flow rates and other technical issues before the start of full production and before Kenya starts oil exports via a pipeline to the coast. The pipeline is due to be constructed by 2022.

The production area in the Turkana region has long been plagued by banditry and cattle rustling. Turkana also lies near South Sudan, a nation torn by years of conflict.

“It is vital that our return to work in Kenya has the backing and support of the government, Turkana leadership and the community. We are working hard on reaching an agreement that will make sure that our operations will not be interrupted in the future,” said Martin Mbogo, Tullow Kenya Managing Director.

“Discussions are ongoing and we are optimistic that we will be able to start crude oil trucking again soon,” Mbogo said.

But he added that essential supplies needed to run production “will run out in the next 14 days after which we will have no option other than a complete shutdown of the camp.”

The company said this month it had reduced its staff at the site due to the unrest in the area that had interrupted operations.

Officials at the ministry of petroleum and mining did not comment immediately when asked about Tullow’s statement.

The protesters are demanding the deployment of more security forces in the area, Kenyan media has said.

Tullow has said the Amosing and Ngamia onshore fields have estimated contingent resources of about 560 million barrels, with plateau production potentially reaching 100,000 bpd.

Reporting by Duncan Miriri, additional reporting by Shadia Nasralla in London; Editing by Jan Harvey and Edmund Blair

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