With Kenya on its way to becoming the first East African oil producing nation after discovering oil last year, petroleum exploration companies are vying for a position in the race to secure local production fields.
This became evident as Barclays bank agreed to fund, Marriot Drilling Africa Limited (MDAL), an oil exploration company and subsidiary of UK-based Marriot Drilling Group in a $13 million oil exploration financing agreement and said the funds will be used to acquire an oil drilling rig.
“Signing a financing agreement of this value reflects the ability and commitment of Barclays Bank to shoulder its responsibilities in financing the projects of leading companies which have a clear strategy,” the managing director Jeremy Awori said Friday in a statement.
According to Business Daily, the 5 year deal makes Barclays bank the first in East Africa to finance an oil exploration project, though other investment houses have struck deals to finance other oil support servicing projects.
Recently, Kenya-based multi business investment company, TransCentury, provided a Sh1 billion ($11.43 million) war chest for its engineering Civicon Group, to provide oil field services (OFS) support.
Similarly, Nigeria’s GT Bank acquisition of 70 percent stake in Fina Bank can be linked to a strategic foresight into penetrating Kenya’s oil and mineral sectors.
These alliances will help fasten the growth rate of the East African oil and gas industry as well as provide financial institution sand oil firms with a mutually beneficial collaboration.
It is also expected to shore up the fortunes of the financial houses such as Barclays – which recorded a H1 profit fall of 13 percent – and provide oil firms, which currently lack the funds to begin exploration.