Turkana al­lo­cated dou­ble Uhuru oil cash of­fer in bill

Business Daily (Kenya) - - ECONOMY & POLITICS - John Ngirachu jn­girachu@ke.na­tion­media.com

Kenya has made a U-turn and al­lo­cated the com­mu­nity sur­round­ing Turkana oil­fields a 10 per cent share of oil rev­enues, dou­ble what Pres­i­dent Uhuru Keny­atta had ear­lier di­rected.

The amended Petroleum Bill en­ti­tles the com­mu­nity to 10 per cent of gov­ern­ment oil rev­enues, and a fur­ther 20 per cent to the county gov­ern­ment in whose ju­ris­dic­tion the crude de­posits lie.

Kenya has struck 750 mil­lion bar­rels of crude in Turkana, con­sid­ered com­mer­cially vi­able, with fur­ther ex­plo­ration on­go­ing but pro­duc­tion is yet to be­gin.

The pro­posed law is ex­pected to pacify Turkana lead­ers who had bit­terly protested the de­ci­sion by Mr Keny­atta to re­tain the com­mu­nity share at five per cent con­trary to de­mands to have it dou­bled.

“The lo­cal com­mu­nity’s share shall be equiv­a­lent to 10 per cent of the gov­ern­ment’s share and shall be payable to a trust fund man­aged by a board of trustees es­tab­lished by the county gov­ern­ment in con­sul­ta­tion with the lo­cal com­mu­nity,” reads the bill that was tabled in Par­lia­ment on Wed­nes­day.

In Oc­to­ber last year, Pres­i­dent Keny­atta re­jected the push to dou­ble the com­mu­nity for­tune, ar­gu­ing that the share in­crease would re­sult in a wind­fall to the lo­cals more than they would be able to use.

An­other sweet­ener for Turkana is the re­moval of lim­its to the amount of petrodol­lars the county is en­ti­tled to as pro­posed in the orig­i­nal deal.

The Petroleum (Ex­plo­ration, De­vel­op­ment and Pro­duc­tion) Bill spon­sored by Ma­jor­ity Leader Aden Duale has re­moved the con­di­tion stat­ing that the oil cash due to the county gov­ern­ment should not ex­ceed twice the county’s bud­getary al­lo­ca­tion in a fi­nan­cial year.

“The amount shared shall be ex­clu­sive of the amount al­lo­cated by the Na­tional As­sem­bly in the fi­nan­cial year,” says the pro­posed law.

It has also done away with the pro­vi­sion that the rev­enue due to the lo­cal com­mu­nity should not ex­ceed a quar­ter of the amount due to the county gov­ern­ment in a fi­nan­cial year.

Had the orig­i­nal bill re­mained un­changed, it would mean that if a county gov­ern­ment with crude de­posits is al­lo­cated Sh10 bil­lion in a fi­nan­cial year, its share of the oil rev­enues would not ex­ceed Sh20 bil­lion and the com­mu­nity’s share not be more than Sh2.5 bil­lion.

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