Guys. Why the hell should we export crude oil?? I think processing it ourselves and selling the finished good is the best move. First we make sure our fuel prices go low then export the rest.
That is just my view. If you know more about these things educate me.
Simple. Hiyo mafuta(oil blocks) were sold long time ago.
Mafuta ishuke bei sasa. Hii watu wasibebe sisi children
Good thinking. Only problem is the clowns running our business probably signed away our rights at the prospecting stage. We are looking at a Nigerian style bila lube manenos.
Lol!.
If we make our fuel prices go down, the government might end up collecting less taxes than it is now from fuel products. Majority of our fuel bill goes to taxes and the government will not change that.
Indeed there is no point producing our own fuel if the government won’t make money for roads, hospitals etc.
Alafu operating an oil refinery does not guarantee a decrease in price. Before they shut down Changamwe, it had become too expensive to run. It was much cheaper to import already refined oil than refine it at Changamwe.
Of course most of it is due to inefficiencies by Kenyans, but we can’t rule out volume.
Economies of scale would dictate that refining by the tens of millions of barrels will bring down the price. That’s why it will always be cheaper for UAE and the others to do the refining themselves.
Alternatively, if we discover much more oil, perhaps it might be feasible.
But the 2000 barrels a day I’m hearing about does not even come close. Maybe from 300,000 barrels we can start talking.
Finally, we’re exporting crude right now as a pilot study. If or when our oil numbers start making commercial sense, we will have everything mapped. From production, to transport, to export.
Trucks are the least cost-effective way of transporting, but at this stage we’re just testing the system.
Stop exposing your ignorance.
Do we have a refinery? Yes, but it’s not functional.
Should it be refurbished? Probably. However, the refinery was built on technology that is no longer in use. That makes it obsolete. It will require about $ 2Billion to refurbish the current refinery. Our current reserves don’t justify refurbishment at this moment. Ugandans are building a new one at a cost of about $ 4 Billion.
Should we build one? Probably, but not a this point. A modest refinery would cost around $ 5 Billion. That’s around Kshs. 500 Billions. Apart from the high costs of setting up, we don’t have enough oil yet to make it sustainable to build a new refinery. Such a huge investment requires huge crude deposits and our current deposits are not viable to warrant such a decision.
Case study: Angola produces about 1.8 million barrels of oil per day and it has one refinery only. Our confirmed reserves are 750 million barrels and Tullow is currently extracting 2000 barrels only. Again, that’s not enough to justify either the refurbishment of our current refinery or the construction of a new one. Assuming that we have the capacity to extract the same amount of oil as Angola (that is an extraction rate of 1.8 million barrels per day), our oil reserves would be depleted in approximately 416 days only! That is one full year and about 2 months! Quite laughable to even justify the need for building a new refinery, which seems like the best option!
Verdict: it’s too early in the day to start imaging things such as refurbishing our refinery, building a new one, building a pipeline from Lamu to Turkana or even to think fuel prices will drop. It makes more economic sense to export the little that we are producing so that we can test the market. The idea is to understand how much the world would pay if Kenya was doing commercial oil production. Anything beyond that is gossip and wild imaginations.
We most likely sold off most of our rights in the secretive agreements.The investors’ interests come first, and what they want is quick solid dollars and energy back home. Similarly, the ‘facilitators’ are only interested in what they can make in the form of logistics contracts and other such benefits. I foresee trouble from the locals as the expected benefits will most likely delay.
At the current volumes, it would have made more sense to first set up small refineries (they take a few months to set up). Such refineries would have used cheap electricity from the Turkana wind farms. The economy would have enjoyed the many benefits that come with cheaper fuel and local employment opportunities. I really hope the Turkanas ruin the party for these suited thieves.
I lost all hope in the politicos, when we signed that deal with ahmadinejad and then coiled our tails when the big brother came calling.
So we will export the crude oil, then Import crude oil… The Turkana oil will come back as “import” after chilling in the high seas
Y’all. Should have a look at the seven sisters oil documentary. That will make you understand how the oil industry works
same shit with our coffee. we proudly import nescafe that was grown here using subsidized fertiliser provided for by our taxes…si sisi ni wale wasee tumeandalia foreigners mkundu since back then