Kenya is set to begin commercial oil production by the end of 2026, Energy and Petroleum Cabinet Secretary Opiyo Wandayi has said.
Speaking before the Senate plenary on Wednesday, Wandayi said the South Lokichar oil project in Turkana County would start with the production of about 20,000 barrels of oil per day before increasing output in the coming years.
“From the beginning we shall be producing about 20,000 barrels per day, which will progress to some 50,000 barrels per day,” he said.
The CS, however, noted that the current production targets are still below the level required to support a commercially viable refinery.
“Petroleum economics tells us that we need some 300,000, 500,000 barrels per day to run a refinery viably,” he added.
Wandayi defended plans to support the construction of a regional oil refinery in Tanga, Tanzania, saying the project makes more economic sense than reviving the old Changamwe refinery in Mombasa.
The Changamwe refinery stopped processing crude oil in September 2013 after years of operational challenges linked to ageing infrastructure and commercial losses.
The facility is currently used for storing imported petroleum products such as diesel, petrol and cooking gas.
“That informs the reason, the justification and the basis for the plan to establish a refinery in Tanga that will not only serve Kenya but also the other neighbouring countries. It’s basically business logic,” Wandayi told the Senate.
The South Lokichar oil project, now under Gulf Energy, is expected to develop millions of barrels of recoverable oil and export between 25,000 and 80,000 barrels per day through a planned pipeline linked to the port of Lamu.
According to the government, the investment in local and regional oil production is aimed at reducing Kenya’s reliance on imported fuel from the Middle East and other international suppliers.
The proposed Tanga refinery is projected to cost about USD 20 billion (Ksh2.58 trillion) and is expected to help meet the rising fuel demand across Eastern Africa.
Officials also believe the refinery could protect countries in the region from global supply disruptions and price fluctuations caused by international conflicts, including tensions involving the United States and Iran.
