Kenya Creates 17 New Oil Exploration Blocks

Kenya has created an extra 17 new oil exploration blocks, bringing its total to 63 and aims to auction them in a licensing round in 2017, Kenyan newspapers quoted Ministry of Energy and Petroleum saying on Saturday.

British explorer Tullow Oil (TUWLF) and partner Africa Oil first struck oil in Lokichar in northwest Kenya in 2012. The recoverable reserves are an estimated 750 million barrels of crude.

Since the discovery, interest from explorers seeking blocks in Kenya increased.

Privately-owned Standard Newspaper quoted the Energy and Petroleum ministry as saying it aimed to hold an auction for the new blocks in 2017.

"We constituted all the blocks and the country now has 63 blocks .... We now have 17 blocks to license," the Standard quoted Martin Heya, the ministry's commissioner for Petroleum Energy, as saying.

Africa Oil and Tullow were 50-50 partners in blocks 10 BB and 13T where Kenya's the discoveries were made. Africa Oil has since sold a 25 percent stake in those blocks to A.P. Moller-Maersk.

Africa Oil and its partners aim to announce a final investment decision for production in early 2017.

Early this month, Kenya started a search for companies to design a crude oil export pipeline costing some $2.1 billion and which it expects to be should be completed by 2021.

(Reporting by George Obulutsa)