World, Economy, Africa

Kenya: US to help finance $18 billion oil pipeline

Kenya has about 1 billion barrels of untapped oil, expert says

06.01.2016
Kenya: US to help finance $18 billion oil pipeline

NAIROBI, Kenya

The U.S. government said late on Tuesday said that it would help Kenya finance an important oil pipeline project.

Speaking to the press after a meeting with Kenyan Energy Cabinet Secretary Alfred Keter, U.S. Ambassador to Kenya Robert Godec said that the U.S. would help Kenya find $18 billion for the construction of an oil pipeline from Lamu at the Kenyan coast to the oil fields in the north of the country.

“Kenya needs $18 billion worth of financing, [for the construction of the pipeline] so one of the questions we are discussing is how we can work together with the private sector and governments to raise that sum, to find ways to make certain that this financing become available,” Godec said.

Oil deposits were first discovered in Kenya in 2012 in the poor arid and semi-arid areas of what is called the “great rift.”

There are proven reserves in the area of about 1 billion barrels, according to data from the African researcher Ecobank, but Tullow Oil, which has discovered 600 million barrels in the South Lokichar Basin (part of the 'great rift' area), has so far declined to pursue extraction because of the low price of oil.

The Kenyan government is, however, keen to get extraction started.

“I think that that we need to fast track this project so that we join the many countries who are exporters of oil, and so that we can lower the cost of fuel in the country,” Keter told reporters.

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