16 January 2014, Nairobi – A three-day workshop on Fiscal Management of oil and Natural Gas in East African organized by the East African Community together with the International Monetary Fund (IMF) opened today at Mount Meru Hotel, in Arusha,Tanzania.
The 15-17 January workshop is designed to discuss key issues that EAC governments face in managing the fiscal impacts of oil and gas development and emphasize how the issues and policy choices are interlinked.These relate to design of the fiscal regime (tax and non-tax instrument) and revenue collection; options for the macro-fiscal policy framework and fiscal anchor as well as institutional reforms to integrate natural resources revenues into the budget and credible medium-term frameworks.
Delivering the keynote address, the Cabinet Secretary, Ministry of Energy and Petroleum in the Republic of Kenya Hon. Davis Chirchir said that the timing and importance of the workshop to the East African Partner States cannot be over-emphasized due to the fact that the East African region is rapidly emerging as the preferred investment destination by international oil companies who own the risk capital for conducting upstream oil and natural gas operations.
The Kenya Cabinet Secretary disclosed that in Africa out of a combined East African sedimentary basin surface area of about 900, 000km2, only an insignificant number of about 190 exploration wells have so far been drilled in that expansive area.
He noted that number of the wells drilled relative to the expansiveness of the regional sedimentary basins according to international standards translates into a very low average well density of about one well in every 5000 km. The current developments have had a very positive impact of projecting East Africa as a promising alternative destination for exploration and production of commercially viable oil and gas resources, added Hon. Davis Chirchir.
“I am happy that the International Monetary Fund team and the East African Secretariat have, through this workshop, provided East Africa with the a forum to benefit from the invaluable knowledge, skills and experience that the IMF team has built over a long period of time”.
The Kenya Cabinet Secretary underscored the importance of working together to address and mitigate the challenges that either delay or become impediments to enabling the people of EAC region realize the full benefits across the whole value chain of oil and gas production and sale.