Tower Resources and Premier Oil issued a notice to withdraw from block 2B located in the Anza basin, northern Kenya, reported AllAfrica.
“We have withdrawn from the area where we feel there is no medium-term likelihood of commercially worthwhile success,” said Tower’s CEO Graeme Thomson.
The stated cause for the withdrawal was that the drilling of the first well failed to show any crude deposits. Industry analysts, however, have noted that oil companies are shutting down operations across Africa as a cost cutting measure thanks to low oil prices.
It has been estimated that exploration in Kenya has gone down by more than half since last year, again because of falling crude prices.
Premier Oil (55%) and Tower Resources (15%) hold the license for block 2B together with Taipan Resources of Canada. Premier and Tower are both UK-based companies.
In other news, Kenya’s Attorney General Githu Muigai was quoted in The Star as saying that Somalia’s referral of their maritime boundary dispute to an international court is aggressive and disregards 25 years of generosity toward refugees.
On August 28 last year, Somalia filed a complaint at the International Court of Justice, accusing Kenya of encroaching on her ocean territory due to lack of clear sea boundaries.
The disputed area is believed to contain substantial offshore oil and gas reserves.