This archive report was first published on 6 July 2020.
Kenya, Tullow Oil Divorce Gets Messy and Noisy ¶
Published on July 6, 2020
Kenya is on a collision course with Tullow Oil over the company's decision to exit the country, with lawmakers calling for a forensic audit of the firm's books of account.
Members of Parliament have accused Tullow Oil of using derailing tactics in the implementation of the country's oil project, which has prompted investigations into the firm's decision to invoke force majeure.
At the same time, legislators are questioning the $2.04 billion compensation bill the British exploration firm is demanding from the government as expenditure in the country since it discovered crude in 2012.
"Parliament must scrutinise all the expenditures to ascertain they are genuine because it's our duty to protect Kenyan taxpayers," said David Gikaria, chairman of parliamentary Energy Committee.
The parliamentary energy committee is also carrying out an independent probe and has accused the company of "dishonesty" over its operations in the country, including failure to explain expenditures of the recently expired Early Oil Pilot scheme and how revenues accrued from the scheme were shared.
Kenya's Petroleum Ministry Principal Secretary Andrew Kamau said the government is not convinced by Tullow's decision and has demanded a detailed report.
"We want Tullow to tell us the thinking behind it and what it means for project oil Kenya," he said.
Tullow's invocation of force majeure puts Kenya's plans to become an oil exporting nation in limbo, with the country already behind schedule for most of the milestones, including signing of the final investment decision that was slated for this year.
