Tullow Oil has stopped all operations in its Kenyan oil fields, citing unaddressed security fears as local hostility mounts.
Tullow Oil had threatened over the weekend to shut down its oil wells in the Lokichar basin if the government does not act soon to remedy production, security, and transportation problems. Tullow pulled the trigger not even three days later as it finds it difficult to transfer oil to the Kenyan coast as locals continue to interfere with transportation and operations unabated.
Meetings were scheduled between the local community, Tullow officials, and national government to find a resolution that all parties could live with, but according to the East African, those meetings never happened.
"What you saw locally was the local people, the community... using the trucking operation as a lever really to demonstrate to the national government that the security situation on the ground had to improve," Paul McDade, Tullow Oil's Chief Executive Officer said on Wednesday.
Despite the shutdown, McDade said he expected to be up and running again soon, adding that Tullow expected "to be up there working, getting the field back operating again and trucks moving again the near future. But it's important to take the time out so that when we do return... we have a more secure environment."
But Tullow's risk appetite is substantial, suffering many hardships in Kenya since it found oil there in 2012 after almost six decades of exploring.
Tullow's recent oil production and exports was part of Kenya's Early Oil Pilot Scheme that sought to move crude oil from Turkana County to Kenya's coast until a pipeline could be built. Commercial production was expected to start up after the pipeline was in place-the completion of which is expected in 2021.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. More