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Anadarko to Drill for Oil Kenya

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Plans to Drill Two Wells Starting in December

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Manufacturing Group November 6, 2012

Anadarko Petroleum is scheduled to begin exploring for oil and gas in Kenya in December, with plans to drill two wells, the Ministry of Energy's top official says, continuing the east African country's surge of exploration activity.

The two wells, known as the Kiboko prospect in block L11B and the Kubwa prospect in block L7, will be drilled back to back and cost about $140 million each.

In recent months East Africa has been a centre of oil and gas exploration after several big discoveries, including Kenya's second ever oil find announced by British explorer Tullow Oil and Canadian venture partner Africa Oil last week.

Independent U.S. oil and gas company Anadarko has not yet decided which well will be bored first, but drilling is scheduled to start on Dec. 13, according to Patrick Nyoike, Kenya's permanent secretary of energy.

The company is "drilling in Block L7 and Block L11B, back-to-back. We are now preparing them to start the drilling. I guess next year ... I'll be talking about billions of barrels discovered in Kenya," Nyoike told reporters on the sidelines of a nuclear power workshop.

Anadarko is the operator of blocks L7 and L11B and holds 45% of the licences in each. French oil major Total has a 40% stake, and Cove Energy holds the remainder.

Energy officials expect explorers to drill at least a dozen more wells in the next 12 months onshore and offshore Kenya.

The Kiboko and Kubwa prospects will be Anadarko's first wells in Kenya, though it made significant gas discoveries offshore Mozambique earlier this year.

Anadarko spokesman John Christiansen told Reuters last month that Anadarko was due to start drilling later this year but did not specify a date.

Anadarko will be utilising some of the equipment used by U.S. explorer Apache Corp., which drilled a well offshore earlier this year. Apache's well, known as Mbawa-1, did not have oil as the company had hoped, but small, non-commercial quantities of gas.

Anadarko has said it hopes to find oil, rather than gas, because it is cheaper and easier to produce.

The U.S. company has three other blocks offshore but has not yet determined when it will drill wells within that acreage.

Edited from an article by Kelly Gilblom, from Reuters.

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