By Sharon Atieno
Though Kenya discovered oil in 2012, the project has been marred with several challenges which have led to delay in production.
With the discovery came myriads of expectations, with the government looking at the venture as an opportunity for economic growth due to high revenues while communities were looking at development opportunities in terms of infrastructure, social amenities and better livelihoods among others.
There is evidence of an estimated 600 million barrels of oil in the two blocks of oil reserves in Turkana, an area where 85 percent of children live in poverty. It is estimated that at peak production, with all conditions being set right including the construction of the 821-kilometer oil pipeline, the Turkana oil field could generate up to USD 1.2 billion in revenue for the Kenyan Government.
Under the Petroleum Act, 20 percent of that revenue would be distributed to the Turkana County government and five percent to communities around the oil wells.
Speaking at a public forum on oil in Kenya held in Nairobi, Odenda Lumumba, Chief Executive Officer, Kenya Land Alliance cautioned that Kenyans have to manage their expectations by balancing the economy and not tilting it more towards the oil exploration at the expense of other economic activities that make a difference.
“At the end of the day whether the oil is doing well in the market place or not, Kenyans will have to survive, the economy will have to operate,” he said, “diversifying the economy is the way to go.”
Being that Kenya is still new in the oil industry, proper policy and legal framework had not been put in place to manage the whole process. Currently several laws have been put in place including the Petroleum Act and Community Land Law.
Lumumba said that despite the laws being put in place, they have not been implemented and that there are still laws which are lacking.
“We don’t have other laws to deal with sovereign fund and local content which are being thought about,” he said.
Lack of local content plan which highlights the value chain and what the sector is about is a cause for concern according to Ikal Angelei, Director and founder Friends of Lake Turkana.
“For communities to better position themselves to engage in the local content opportunities they have to know the sector,” she said. “Communities just keep getting what is thrown at them and they scramble within communities in terms of who gets what contract, when, who gets which job and who determines who gets the job.”
Lack of transparency in terms of access to information especially by communities is an issue. The government has signed at least 44 contracts yet only 10 contracts are made available to the public. This has left the communities vulnerable and agitating for community involvement.
“We need communities to participate in decision making,” says Thomas Ekai, a Turkana South community member.
Though Turkana is a community land with people’s livelihoods revolving around migration and grazing, it’s only until recently that information concerning the amount of land used in the oil process has been disclosed with proper details of compensation still lacking.
While referring to the lack of a hazardous waste management plan, Angelei noted that: “we talk about economic, but don’t talk about the social and environmental impacts of oil in a time where countries are moving away from fossil fuels.”
Exploration firms leaving the project has also been a source of concern. Earlier this year, Hunting Alpha (EPZ), a global company joined a group of others who had exited the project.
Lumumba however points out that this is a normal occurrence in the extractive industry. “Extractive industry is long term whoever does exploration, hardly has capital to develop and extract. Those who do extraction strike and sell off license to the people who have capital, who normally come in late,” he said.
“We may still see even those who are partnering with Tullow leave, even Tullow itself could leave.”
The same sentiments are shared by Charles Wanguhu, activist, Kenya Civil Society Platform: “more service providers will pull out but they will come back once the final investment decision has been made for example, in the financing of the pipeline.”
Wanguhu cautions that there is need to manage expectations around employment as not many jobs will be available.
“We need radical transparency in terms of who these opportunities are coming to,” he said, “even in the few jobs that are created, we need to be clear that it is not only politically connected entities that are getting these contracts and that they factor in youth and women.”