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International oil and gas meeting spells new beginnings for region

By Jonah Aiyabei | Published Wed, May 16th 2018 at 00:00, Updated May 15th 2018 at 19:54 GMT +3
Oil barrels. the international oil and gas forum at UoN spells new beginnings for Kenya. [File, Standard]

This week, delegates from different parts of the world congregate at the University of Nairobi to deliberate over the opportunities for capacity building in the oil and gas sector and other extractives in the larger East Africa region.

The conference aims to trigger a regional conversation on the best avenues to build capacity for the nascent oil and gas sub-sector as Kenya joins the club of oil-producing countries in the very near future.

With the new oil and gas discoveries, there is need for a sustained public discourse on the most prudent ways of utilising the precious resources in the country and the region to transform lives.

Recent discoveries of oil and gas reserves in eastern Africa, specifically in Kenya, Uganda, Tanzania and Mozambique, have the potential to transform these economies to new heights. Studies show that East Africa’s current growth pattern makes the region the most attractive on the continent.

This demonstrates that East African countries continue to exhibit resilience in the face of global economic adversity despite threats such as lower oil and commodity prices, and political uncertainties that could affect growth.

If well managed, these resources could be fundamental in meeting the huge infrastructural deficits that characterise the region, and indeed the continent. The resources could form the basis for agricultural transformation and investments in key aspects of human capital such as education and health.

Great opportunity

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The oil and gas resources in Kenya therefore present a great opportunity to sustain high rates of growth and accelerate job creation in line with President Uhuru Kenyatta’s Big Four development agenda, namely manufacturing, universal healthcare, food security and affordable housing. But this potential cannot be exploited when Kenya is still importing pipeline welders and coaters.

Lack of requisite skills for the oil and gas sector remains a major challenge as the country and the region prepare to exploit the new-found resources. This, together with other challenges such as lack of adequate oil and gas infrastructure, and the high cost of capital required to set up the appropriate technology are some of the issues the conference will address.

Kenya Pipeline Corporation (KPC) is the only white pipeline operator in the region, with more than 1,800km of pipeline network. But as the region embarks on large-scale oil and gas exploitation, experts estimate that over 2,700km of pipeline will be developed to coincide with this significant growth. This will require more than 2,800 oil and gas technicians - up from the 700 the region has, all of whom work in KPC.

These demand dynamics in the sector are what Morendat Institute of Oil and Gas is out to address - to build a human resource base in the region to manage, operate and maintain oil and gas pipelines.

As a region, we must moot proactive sector strategies and programmes, and that is why a focused and sustained public discourse on the opportunities and challenges that come with the discovery of oil and gas reserves in our backyard must now begin.

Private sector

The capacity-building conference is one such avenue through which governments, private sector, donors, international community and, above all, host communities for the natural resources can be empowered with the right information to help the country and the region avoid the ‘resource curse’ where oil and gas revenues lead to instability, poverty and corruption.

With these glaring sector gaps, three questions remain critical: How do we prudently utilise the oil and gas resources in our midst? How does Kenya position herself strategically for economic prosperity given the discovery of these opportunities in the region? And do we have adequate human resources for this emerging sector?

These questions may not be answered exhaustively today, but KPC set up Morendat Institute of Oil and Gas in 2016 with the aim of developing human resource capacity for Partner States in Oil & Gas Pipelines Management, Operations and Maintenance to reduce dependence on expatriates.

The institute is a local training school for specialised skills in oil and gas designed to save on costs incurred hiring foreign experts to work on the country’s infrastructure. It draws students from across East Africa with the aim of building local capacity for future assignments, in line with Government's policy of promoting local content.

The problem of skills gap and skills mismatch has denied Kenya a big portion of mega projects, with most of our young people confined to menial labour.

Our new school will not only prepare young people for the future and help reaffirm the country’s status as a new player in oil and gas trade, it will also build human resource capacity in neigbouring countries to enable them to manage, operate and maintain oil and gas pipelines and reduce dependence on expatriate labour.

Dr Aiyabei is the director, Morendat Institute of Oil & Gas; [email protected]

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