Since when did the cost of extracting kenyan crude oil settle at 30 billion dollars,proof beyond reasonable doubt and i will lick your boots,you see, Mkikuyu Akili-timamu is very good at twisting facts to suit his perverted prejudice against kenya while misleading guillible forumers,now having said that,allow me to put you on a reality check by dissecting oil economics, first of all,once you set up the machinery and associated infrastructure upon oil fields,its all systems go,the only cost incurred here is labour to run the machinery which in most cases is insignificant vis a vis income generated,its just that rudimentary,stop pulling inflated cost of 30 billion dollars out of thin air.ofcourse there is the cost of setting up the entire infrastructure mechanism.this now begs the question,how much has tullow used to set up the infrastructure,which they will recoup during oil sales.and when i say infrasture, i mean everything from exploration to production level. Secondly the methodology of extraction is highly dependent on the type of oil,look,there are three types of oil world over,which are a)sweet light b)heavy sour c)hybrid of the above two when it comes to hybrid the distinction in between is not definite,its continous with varying dinstinction of density i.e the amoumt of sulphur,the higher the content of sulphur the bitter and heavy it becomes which automatically raises the cost of extraction.then there is sweet light which is very easy to extract hence highly profitable,this is mostly found in gulf countries.in most instances the type of oil in offshore fields is indefinate,the amount of sulphur is neither concentrated nor diluted(hybrid)this is the kind of oil we have in kenya,its also found in texas which they are now extracting through fracking tech,which is extremely cheap,thats why they have flooded the market and greatly ruducing the price of brent per barrel.this type is highly sought after,you can imagine demand when production starts.but most important extraction won't be that intensive since its hybrid. Having said that the elephant in the room ought to be.how much has tullow incurred from the time of exploration to the period of commercial production.secondly,what is the total amount of proven recoverable reserves,thirdly and the most important,what is the balance of accounts when you deduct the gross cost of producing vis a vis the total value of recoverable product.in simple terms profit,i think kafrican has dissected that for you in a previous post.
