Under the deal inked Friday, Lundin Petroleum of Sweden will explore oil deposits in the lake’s Anza Basin for the next four years, state-run Kenya Broadcasting Corporation quoted Energy Minister Kiraitu Murungi as saying.
Murungi said Kenya’s northwestern area is likely to have oil deposits after the discovery of oil and gas in neighbouring southern Sudan and along the Uganda-Democratic Republic of Congo border.
Lundin Petroleum chief executive Charles Ashley said oil exploration carried out in 1980s in northeastern region yielded indicators of possible oil or gas deposits.
“Past exploration efforts dating back to the late 1980s have proven the existence of excellent quality, oil-prone source rocks, oil-saturated sandstone reservoirs, and a multitude of structural traps which remain undrilled,” Ashley explained.
Under the agreement, Lundin Petroleum will be the sole operator under the Block 10A Production Sharing Contract (PSC), with the Kenyan government having an option to participate with up to a 13 percent interest in case of a discovery.
Nearby to the Lundin exploration block, energy giant Royal Dutch Shell said in the mid-1980s there were signs of oil deposists in Erie Springs on the shores of Lake Turkana.
Although Royal Dutch Shell abandoned the effort after running out of funds in 1992, Kenyan authorities continued to believe the prospects for finding oil in the region were good.
Last year, the state-run China National Offshore Oil Corporation (CNOOC) signed an agreement to look for oil in the country’s Indian Ocean waters, covering six blocks covering 115,343 square kilometers (44,534 square miles).
Kenya currently imports most of its oil from Sudan.