In a critical leap toward commercial oil production, Gulf Energy has leased a high-capacity onshore drilling rig from the United Arab Emirates, signaling a definitive timeline for the extraction of Kenya's first commercial oil in the South Lokichar Basin.

Gulf Energy E&P BV, the firm that aggressively assumed control of the Turkana oil project, has officially secured an onshore oil rig from the Middle East, injecting renewed momentum into Kenya's long-delayed petroleum ambitions. The strategic acquisition effectively sets the stage for drilling operations to commence in early July, firmly targeting the delivery of the nation's first commercial oil by the end of the year.

This development is an economic watershed for Kenya. The transition from prolonged exploration and logistical delays to active drilling represents the actualization of a massive US$6.1 billion (approx. KES 793bn) investment over a 25-year contract period. For the local economy in Turkana and the national exchequer, the mobilization of this heavy machinery is the first tangible proof that the much-anticipated petrodollar revenue stream is finally within reach.

Securing the GW70 Onshore Rig

In a detailed market update released on Friday, February 20, Gulf Energy announced the successful contracting of the GW70 rig from the Great Wall Drilling Company (GWDC) based in the United Arab Emirates. Valued at over US$15 million (approx. KES 1.95bn), the 1,500-horsepower capacity rig was secured under a comprehensive long-term lease arrangement. The machinery boasts an impeccable track record, having previously been deployed on high-stakes projects for the prestigious Abu Dhabi National Oil Company (ADNOC).

Gulf Energy Chairman Francis Njogu confirmed that logistical arrangements are already operating at full throttle to ship the massive rig from Abu Dhabi to the Port of Mombasa before the end of March. Following its arrival, the rig will undergo rigorous procedural commissioning and acceptance checks throughout June, ensuring absolute readiness for the crucial spud operations in early July.

"At Gulf Energy, it's all systems go in the journey to deliver first oil by December 1st this year. The delegation in Abu Dhabi has witnessed firsthand the advanced state of GW70, an integrated onshore oil field drilling rig which we recently secured," Njogu stated, underlining the company's aggressive operational timeline.

Strategic Capacity Building and Skills Transfer

Beyond the raw mechanics of drilling, the lease agreement with GWDC is structured to yield long-term domestic dividends. Gulf Energy has mandated a performance-based operational model that explicitly demands active skills transfer from the expatriate operators to local technical teams. This deliberate integration ensures that Kenya organically develops the localized expertise necessary to sustain a robust oil and gas sector for decades to come.

To guarantee operational safety and performance readiness, a high-level technical delegation recently conducted an exhaustive inspection tour of the rig in the Al Dhafra region of Abu Dhabi. The delegation was a masterclass in inter-governmental coordination, featuring key representatives from:

• The State Department for Petroleum: Ensuring alignment with national strategic energy goals.
• The Energy and Petroleum Regulatory Authority (EPRA): Verifying compliance with stringent international safety and environmental standards.
• The Turkana County Government: Led by County Secretary Dr. Amb. Richard Ekai, ensuring that local community interests and environmental safeguards are prioritized before mobilization.

Overcoming Legislative and Logistical Hurdles

The aggressive mobilization comes at a time when Gulf Energy is still awaiting the final parliamentary ratification of its Field Development Plan (FDP) for Blocks T6 and T7. However, recognizing the stretched mobilization timelines and high global demand for specialized drilling equipment, the firm proactively committed the necessary capital to secure the rig. The comprehensive FDP outlines a phased developmental rollout targeting an initial output plateau of 50,000 barrels per day, drawn from recoverable reserves estimated at an impressive 326 million barrels.

Financially, the South Lokichar project is heavily incentivized. It operates under a revised production-sharing contract that grants Gulf Energy and its subsidiaries strategic exemptions from value-added tax on petroleum-related goods, import declaration fees, and railway development levies. These fiscal buffers are crucial in shielding the capital-intensive project from domestic economic volatility.

"This ensures not only efficient rig operation but also capacity building for local technical teams, strengthening Kenya's oil and gas expertise," Chairman Njogu concluded, cementing the project as the single most significant private-sector-driven upstream petroleum investment in Kenya's history.