1. Drilling and Exploration
Strategies
for Kenya and Niger2014

2. Kenya Opportunities • Geotermal
• Oil and Gas

3. Facts
Background
• Kenya gained independence in 1963
• Total Area : 580.367km2
• Etnics : Kikuyu 22%, Luhya 14%,
Luo 13%, Kalenjin 12%, Kamba 11%, Kisii 6%,
Meru 6%, other African 15%, non-African 1%
• Language : English (official), Kiswahili
(official)
• Religion : Christian 82.5% , Muslim
11.1%, Traditionalists 1.6%, other 1.7%, none
2.4%, unspecified 0.7% (2009 census)
• Population :44,037,656 (July 2013 est)
• GDP (purchasing power parity): $77.14 billion (2012 est.)
• Budget : $7.418 billion (revenue)
• Industries : small-scale consumer goods (plastic,
furniture, batteries, textiles, clothing, soap,
cigarettes, flour), agricultural products, horticulture, oil
refining; aluminum, steel, lead; cement, commercial ship
repair, tourism
• Exports : $6.285 billion (2012 est.) tea, horticultural
products, coffee, petroleum products, fish, cement to
Uganda 10.5%, Tanzania 10.2%, Netherlands 7.1%, UK
6.7%, US 5.8%, Egypt 5.2%, Democratic Republic of the
Congo 4.5% (2012)
• Imports :$15.1 billion (2012 est.) machinery and
transportation equipment, petroleum products, motor
vehicles, iron and steel, resins and plastics to India 20.7%,
China 15.3%, UAE 9.5%, Saudi Arabia 6.7% (2012)
Energy
• Electricity production : 6.573 billion kWh (2009 est.)
• Electricity consumption :5.516 billion kWh (2009 est.)
• Electricity export : 27 million kWh (2009 est.)
• Electricity import : 38 million kWh (2009 est.)
• Electricity ınstalled generating capacity: 1.706 million kW (2009 est.)
• Electricity from fossil fuels : 43.3% of total installed capacity (2009 est.)
• Electricity from nuclear and hydrolic plants and renewables 0%, 43.8% of (2009 est.), 12.9% of
• Crude oil production : 0 bbl/day (2011 est.)
• Crude oil exports :0 bbl/day (2009 est.)
• Crude import :32,560 bbl/day (2009 est.)
• Crude proved reservs : 0 bbl (1 January 2012 est.)
• Refined petroleum products Production :30,960 bbl/day (2008 est.)
• Refined petroleum products consumption : 79,410 bbl/day (2011 est.)
• Refined petroleum products exports : 1,065 bbl/day (2008 est.)
• Refiend petroleum products imports : 34,990 bbl/day (2008 est.)
• Natural gas production :0 cu m (2010 est.)
• Natural gas consumption :0 cu m (2010 est.)
• Natural gas exports :0 cu m (2010 est.)
• Natural gas imports :0 cu m (2010 est.)
• Natural gas proved reserves :0 cu m (1 January 2012 est.)
• CO2 emission :12.25 million Mt (2010 est.)
• LNG export : 0
• Pipelines : oil 4 km; refined products 928 km (2013)3

4. Reasons to Invest in Geotermal Energy in Kenya_2
• Kenya intends to be a mid-income economy in the next 20 years. One of the key drivers of this
Vision is the availability of affordable and reliable energy.
• It is projected that the country will require 10, 000 MWe in the next 20 years; 5000MWe of
which is expected to come from geothermal sources.
• The Government of Kenya established the Geothermal Development Company (GDC) to
accelerate the development of its geothermal resources. GDC has embarked on a plan to realize
at least 5,000MWe of electricity in the next 20 years.
• Nnumerous investment opportunities in the geothermal development sector ranging from:
1. Supply of equipment and materials
2. Developments of steam fields and power plants
3. Supply of Early Generation equipment
4. Civil engineering and construction works, among others
• The current demand exceeds the installed capacity hence a ready market for affordable power is
available.
• The demand for electricity is estimated to increase at the rate of 8% per annum.
• Only 15% of the population can currently access power. The growth is driven by increased
consumption from the existing customers of 5% while new customers account for the 3%.

5. Reasons to Invest in Geotermal Energy in Kenya_2
• In order to facilitate investor entry into the geothermal sector, GDC will undertake exploration
and drilling for all fields and provide steam to investors to mitigate these upfront risks to
accelerate investor entry into the geothermal development sector.
• Current Private Sector Participation include Orpower4 Inc and Oserian Development Company
(ODC).
• OrPower4 has an installed capacity of 55MW which is connected to the national grid.
• Oserian Development Company operates two binary power plants each with a capacity of 2MW
which supply power to its facilities.
• Oserian also uses the geothermal resources for heating, refrigeration, use of carbon dioxide and
hydrogen sulphide to enhance plant growth, fumigation and sterilization of greenhouses.
• Alternative geothermal usage in Kenya can be applied to:
1. Dairy industry - refrigeration and pasteurization of milk products
2. Grain Silos - drying of grains (wheat & maize) and other farm products e.g. pyrethrum
3. Space heating - green houses and hotels
4. Industry - production of industrial sulphur, treatment of hides and skins and honey
processing,
5. Water heating for fish and crocodile farming, and spas/swimming pool

6. Geotermal Sites
• Barrier
• Namarunu
• Emuruangogolak
• Silali
• Paka
• Korosi
• Baringo
• Bogoria
• Menengai
• Nakuru
• Elmemteita
• Ebrurru
• Naivasha
• Longonot
• Margaret
• Suswa
• Magadi
• Shompole
• Natron
• Olkaria
• More than 14 high
temperature potential
sites occur along the
Kenyan Rift Valley
• estimated potential of
more than 15,000 MWe.
• Other locations include:
Homa Hills in Nyanza,
• Mwananyamala at the
Coast and Nyambene
Ridges.
• These prospects are at
different stages of
development

7. Geotermal Potential of Kenya
• Geothermal resources in Kenya are concentrated in the Rift Valley
with more than 14 fields extending from Lake Magadi to Lake
Turkana.
• There are also low temperature fields outside the rift at Homa Hills
(Nyanza) and Massa Mukwe (Coast Province).
• The current geothermal potential has been estimated at 10, 000
MW.
• Currently geothermal energy contributes 209 MW which is about
22% of the country’s production.
• With regard to direct use, a horticultural farm in Naivasha uses
about 15 MW of geothermal energy to heat 50 hectares of
greenhouses of roses for export.
• A tourist hotel at Lake Bogoria is utilizing spring water at 38°C to
heat a spa pool.
• The costs affiliated with the development of geothermal projects
depend on a variety of factors that include location, megawatt size,
distance of the resource to the power infrastructure, and the type
of geothermal resource (hot water or steam).
• The investor signs a Power Purchase Agreement (PPA) with the
Kenya Power and Lighting Company Ltd (KPLC) to supply
electricity for a given period of time. KPLC also pays capacity
charge.

8. Kenya_Oil
• Production History
• 1st Exploration well 1960
• 1st discovery 1960; non commercial
• Total Exploration wells drilled 25
onshore 6 offshore
• No current production
• There were 26 PSC in force with an
acreage of 259.050 km2 where 196.720
km2 onshore and 11.745 km2 on shelf
and 50.585 km2 deep water
• 4 new contracts are assigned and 8 new
companies acquired interest
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9. Oil Blocks in Kenya

10. Kenya_ General Terms
13
Exploration Production
Type of Right
•Exploration Permit: confers non exclusive geological and geophysical survey
rights, excluding drilling rights
•PSC: Exclusive right to conduct all E&P activities
•A Production Sharing Agreement
Duration
•Negotiable initial exploration period
•First additional exploration period
•Second negotiable additional exploration period
•Generally 3 + 3 + ‘
•The expoariton period can be further extended for evaluation of a discovery
•Minimum of 20 to 30
•Generally the develoopment and
production period is 25 years
from the date of each
development plan
Obligation
•A Seismic commitment is required for the first exploration period
•A drilling commitment with minimum expenditure in subsequent
exploration periods
Payments
•A signature bonus may be required (75.000$-500.000$)
•Negotiable training fee is payable
•No production bonuses are
payable
•A negotiable annual training fee
is payable
Rentals •Annual rentals are payable at negotiable rates
Annual rentals are payable at
negotiable rates

11. Niger Exloration and
Development

12. Niger_Facts
Background
• Niger became independent from France in 1960
• Total Area : 1.267 million sq km
• Etnics : Haoussa 55.4%, Djerma Sonrai 21%,
Tuareg 9.3%, Peuhl 8.5%, Kanouri Manga 4.7%, other 1.2% (2001
census)
• Language : French (official), Hausa, Djerma)
• Religion : Muslim 80%, other (includes
indigenous beliefs and Christian) 20%
• Population :16,899,327 (July 2013 est.)
• GDP (purchasing power parity): $13.34 billion (2012 est.)
• Budget : $1.698 billion(2012 est.) (Revenue)
• Industries : uranium mining, cement, brick, soap, textiles, food
processing, chemicals, slaughterhouses agricultural products,
cowpeas, cotton, peanuts, millet, sorghum, cassava (manioc), rice;
cattle, sheep, goats, camels, donkeys, horses, poultry
• Exports : $1.389 billion (2012 est.) uranium ore, livestock, cowpeas,
onions to Nigeria 41%, US 17%, India 14.1%, Italy 8.5%, China 7.7%,
Ghana 5.7% (2012)
• Imports :$2.328 billion (2012 est.) foodstuffs, machinery, vehicles
and parts, petroleum, cereals from France 14.2%, China 11.1%,
French Polynesia 9.9%, Nigeria 9.7%, Togo 5.5% (2012)
Energy• Electricity production : 210 million kWh (2009 est.)
• Electricity consumption :695.3 million kWh (2009 est.)
• Electricity export : 0 kWh (2009 est.)
• Electricity import : 500 million kWh (2009 est.)
• Electricity ınstalled generating capacity: 145,000 kW (2009 est.)
• Electricity from fossil fuels : 100% of total installed capacity (2009 est.)
• Electricity from nuclear and hydrolic plants and renewables 0%, 0% of (2009 est.) 0% of
• Crude oil production : 6,712 bbl/day (2011 est.)
• Crude oil exports :0 bbl/day (2009 est.)
• Crude import :0 bbl/day (2009 est.)
• Crude proved reservs : 0 bbl (1 January 2012 est.)
• Refined petroleum products Production :0 bbl/day (2008 est.)
• Refined petroleum products consumption:5,629 bbl/day (2011 est.)
• Refined petroleum products exports : 0 bbl/day (2008 est.)
• Refiend petroleum products imports : 3.330 bbl/day (2008 est.)
• Natural gas production :0 cu m (2010 est.)
• Natural gas consumption :0 cu m (2010 est.)
• Natural gas exports :0 cu m (2010 est.)
• Natural gas imports :0 cu m (2010 est.)
• Natural gas proved reserves :0 cu m (1 January 2012 est.)
• CO2 emission :1.796 million Mt (2010 est.)
• LNG export : 0
• Pipelines : 0 km

13. Introduction
Contract Type
• Law no 2007-01 the Oil Code issued on 2007
• 8 years exploration period (4+2+2) plus 1 additional year in
case of discovery
• 35 years exploitation period (25+10) with contract term
renegotiable by the goverment for the 10 renewal period
• Option up to 20% state participation with minimum carried
costs equivalent to 10,5 of State involved
• Signature bonus is applicable
• Suppression of temporary exploitation permit (2 years
validity)
• Suppression of incremenatl royalties, replaced by a fix rate
between 12.5% and 15% for crude oil and fix rate between
2.5% and 5% for natural gas
• Royalty on transportation (1500000 x OF /sqkm/year)
• Tax on net profit is indexed on operations profiability and
varies between 45% to 60%
• signature bonuses are mandatory
• July 2012 : 9 PSC are to 5 companies
• Dibella 1 and Dallol to Labana Petorleum
• Manga-1, Manga 2 , Aborak and Tenere Quest to
International Petroleum
• Djabo 1 to Genmin ltd
• Grein block to Sirius Energy Resources Ltd
• Mandaram 2 to Advantica Gas and Energy Ltd
Goverment
• November 2012 Ministry of Mines and Energy of the Republic of Niger issued new petroleum
blocks map
• Six of these blocks are in Murzuq Basin, known as Djado Basin in Niger, Agadez political
province:
• Djado 2: 12,920 sq km
• Dissilak 20,030 sq km
• Karam 30,740 sq km
• Tchigai 21,230 sq km
• Twelfth of these blocks are in the Iullemmeden Basin, located on the East of Niger:
• Ader: 31,600 sq km
• Azawak: 28,400 sq km
• Irhazer: 25,630 sq km
• Tadarast: 39,740 sq km
• Talak: 30,380 sq km
• Tarka: 43,700 sq km
• Tegama: 32,800 sq km
• Tounfalis: 38,350 sq km
• Yaris: 31,200 sq km
• Nine of these blocks are in the Chad Basin:
• Achegour: 16,750 sq km – East of the Termit Trough and South of the
Seguedine Rift
• Araga: 28,420 sq km - East of the Termit Trough and the Seguedine Rift
• Damagaram: 31,530 sq km – West of the Termit Trough
• Dibella 2: 28,710 sq km - East of the Termit Trough
• Homodji: 33,900 sq km - East of the Termit Trough
• Seguedine: 21,850 sq km - East of the Termit Trough and the Seguedine Rift
• Tafassasset: 22,020 sq km – North of the Termit Trough and West of the
Seguedine Rift

14. Technical Assestment
Chad Basin
• September 2012 CNPC obliged to submit a
formal proposal for the bid og Dibella 2
• Despite the private negotiation between CNPC
and Niger Goverment many oil companies
submitted application for the block.
• Dibella 2 is located in the southern border with
Chad in the East diffa region 28.165 km2
• CNPC wanted to ensure the block after major
discovery in Oyou 1 well in Bilma block
• Sonatrack entered the second explorationperiod
for its Kafra block. Therefore the compnay has
to relinguish 50% of the block. Sonatrack is going
to drill an exploration well in 2013.
• CNPC entered the second exploration period of
its Tenere block, Tenere Rift. Therefore the
company has to relinquish 50% of the block. The
relinquished part is a new open block available.
The block is 100% operated by CNPC.
Djado Basin
• Helios Oil and Gas is interested in blocks
Djado 2 and Djado 3 in Murzuq basin known
as Djado basin in Niger
• 4 wells drilled in this area between 1961 to
1964 and 2 wells in 2000 where only one
has oil shows
• Paleozoic is nearly 2000m and increases
towards north
• Well data suggest that good reservoirs exits
in Cambro-Ordovician, Lower Devonian and
Visean where Ordovician, Silurian and
Carboniferous shales are cap rock
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