Why Kenya’s dream of oil riches remains a long pipedream

By: LILIAN OCHIENG

Delays in Lamu Port South Sudan Ethiopia Transport (Lapsset) corridor and the fall in global oil prices will stretch Kenya’s plans to produce oil beyond 2017, a new study says.

Oxford Business Group Friday said in its The Report- Kenya 2015 that Lapsset is “ambitious and running behind schedule.”

The survey also says that, “production will not begin until the anticipated oil price recovery.”

Lapsset connects South Sudan and Ethiopia to Uganda and Kenya.

The pipeline is then linked to deep water export in Lamu as well as a new oil refinery.

The project was inaugurated by Heads of State of Kenya, South Sudan and Ethiopia in 2012.

So far, only the detailed design for the first three berths at the Lamu Port are complete.

Lapsset boss Silvester Kasuku in a presentation noted that, “the first three berths will be constructed to attract private sector investors for port operations and construction of the remaining 29 Berths.”

The Lapsset project has faced several constraints such as conflicts arising between neighbouring communities fighting over land.

Investors have also noted that the high cost of land is a huge obstacle.

Insight by the report come even after the Toyota Tsusho design released August stated that the flow of the first oil is expected in October 2022, at the earliest.

SOURCE: DAILY NATION