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British Firm Tullow Oil Risks Losing Oil Concession In Kenya

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British Firm Tullow Oil has until December to present to Kenya government a comprehensive plan for oil production in the Turkana region or risk losing concession on two exploration fields in the area.

Tullow, which struck oil in the Lokichar basin of Turkana nine years ago, is yet to develop the field for commercial production amid growing frustrations for Kenya over delayed petroleum wealth benefits.

The delay has been attributed to several factors, including unfavourable global oil prices, approval delays for land and water rights, a tax dispute and Covid-19 disruptions, according to Tullow.

Petroleum and Mining Principal Secretary Andrew Kamau said yesterday the December deadline would be enforced. “Conditions are always there in the PSC (Production Sharing Contract),” he said in reference to the ultimatum.

Tullow said it was in a race to submit an investment plan by the June deadline to avert possible loss of exploration licences on blocks 10BB and 13T.

“Tullow and its joint venture partners expect to complete a revised assessment of the project by the second quarter of 2021,” the British firm said.

“One of the conditions requires the Group to submit a technically and commercially compliant Field Development Plan (FDP) with the Government of Kenya by December 31, 2021.

If the FDP is not submitted by December 31, 2021, the extension period will expire on December 31, 2021.”

The investment plan would dictate Kenya’s final decision on whether to allow Tullow and its partners to proceed with the development of the Kenyan oil project next year.

When a firm first wins an oil licence, it is typically given a number of years of exclusive rights to explore.

If it is successful and finds oil, its exploration permit usually entitles it to subsequently receive a production authorisation for the area, which could last up to 30 years.

Tullow and its partners in the project Africa Oil and Total had initially planned to reach a final investment decision in 2019 and production of first oil between this year and next year.

Tullow in 2020 received an extension to its exploration licences in Kenya to the end of 2021 in the wake of a three-months freeze attributed to disruptions from Covid -19.

Kenya agreed to extend Tullow’s licences after intense negotiations between May and August 2020.

The licence deal saw the explorer lift the Force Majeure it had declared on the Turkana oil project in May last year while the government agreed to exempt the supplies brought in by British oil exploration firm from value-added tax (VAT).

The Treasury had removed the VAT exemption on taxable supplies.

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Germany, Rwanda Sign Rwf90B Financing Agreement

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Finance Minister, Dr. Uzziel Ndagijimana, and the Germany Ambassador to Rwanda, Dr. Thomas Kurz, today signed two agreements worth € 78 million (Approximately Frw 90 billion).

The financing and technical cooperation agreement is the outcome of the Inter-Governmental Negotiations that were concluded last Year between our two respective Governments.

59 million Euros of the grant agreement will be provided through KFW Development Bank and will support various initiatives including technical and vocational training, promotion of export oriented SMEs, through the support to Export Credit Facility in Rwanda under BRD, promotion of green investments as well as ICT support.

The remaining Euros19 million will be channeled through GIZ and will support decentralization and good governance, prevention of sexual and gender based violence among others.

Speaking after the signing event, Minister Ndagijimana said the financial support extended to Rwanda will support key areas that are critical to the attainment of the country’s development objectives.

“This support comes at a critical juncture given the effects COVID-19 has had on our social –economic advancement. We look forward to boosting these important areas that are in line with our National Strategy for Transformation. We thank Germany for the strong cooperation and solidarity especially during the COVID-19 pandemic,“ Minister Ndagijimana said.

Ambassador Kurz stressed: “These Agreements underline the long-standing and proven cooperation between our two countries based on friendship and mutual trust. Germany is committed to support Rwanda in its Economic Recovery Process and the implementation of NST 1 in order to reach the SDGs and to leave no one behind.”

The Division of Labor allows Germany development cooperation programme to be active in Education (including TVET); Decentralization and Good Governance, Private Sector Development and Youth; Public Financial Management (PFM); Financial Development. Germany also supports Regional Projects: Centre of Excellence for Health, Improvement of the Investment Climate, Microfinance sector-MIFSSA, ICGLR and Energy.

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Malawi Issues 86 Licenses For Cannabis Production

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Malawi’s Cannabis Regulatory Authority said on Friday they had issued 86 licenses to 35 companies and cooperatives to venture into cannabis cultivation for industrial hemp production.

Boniface Kadzamila the Board Chairman of Cannabis Regulatory Authority made the announcement from Lilongwe on Friday afternoon.

He said that a total of 41 companies applied but only 35 of them satisfied the requirements.

According to him the authority has issued licenses for cultivation, processing and storage and has not yet issued any license for export of cannabis.

A recent analysis by Invegrow Limited, one of the firms that conducted research on industrial hemp, found that a kilogram of industrial hemp could fetch U$1,444 on the market that there is potential for direct annual benefit for Malawians in excess of U$ 135,440,973 on 16.5 hectares or U$8,803,663 per five hectares.

The analysis further indicated that the crop has ready markets whose global value chain is worth U$9billion thus giving local Malawi investors a basis to take up cannabis production.

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ex-Nakumatt CEO’s Home Auctioned

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Atul Shah, the former chief executive officer of the collapsed retail giant Nakumatt lost his home to auctioneers over a U$18,609,740 debt.

The auction follows the conclusion of a protracted court battle after the Kenyan High Court dismissed a petition seeking to overturn the forced sale of the high-end property by KCB Group.

Justice Francis Tuiyott dismissed the petition by the administrator of the collapsed Supermarket chain, saying it has no chance of success.

Nakumatt’s court-appointed administrator had opposed the sale on grounds that the auction failed to follow the law, and tagged Mr Shah as an interested party to suit.

The bank, through Leakey Auctioneers, early in the year quietly sold the property, which Mr Shah had used as additional security as Nakumatt’s guarantor to offer comfort to the multiple bank loans.

“This court is not persuaded that the suit, as currently presented, demonstrates a prima facie case with a probability of success. Being unable to surmount that hurdle, it is needless for this court to discuss other aspects raised in the application,” the judge said.

KCB had earlier sold Mr Shah’s prime property in Industrial Area, Nairobi, to Furniture Palace International Ltd for about U$9,677,064 court records show.

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