Minister’s firm sold Turkana oil block for Sh800m

A company associated with a Cabinet minister sold the block, where oil was found in Turkana, for a fortune.In 2010, Turkana Drilling Company, associated with the Cabinet minister who was affected in monday's reshuffle sold Block 10BB for $10 million (Sh840 million) to Africa Oil.Turkana Drilling’s case is just an example of how small firms might be using influence in government to make hundreds of millions of shillings by trading in oil prospecting licences.The whole business of acquiring blocks has been invaded by influence peddlers and well-connected middlemen, including Cabinet ministers.More sensational is the manner in which licence holders have been making millions of shillings selling the licences to third parties.The way the game is played is all too familiar: as a well-connected speculator, the first thing you will do is make sure that the obligations in the licence are as minimal as possible and that the terms will not require you to spend too much money.With the licence in your hands, you make sure that you are in a position to influence government officials to vary the terms as many times as possible as you wait for the opportunity to “flip”, that is sell, the licence at a handsome profit.Big money has been made selling these licences and trading rights to third parties. A Canadian company made Sh5 billion in this way.The Toronto Exchange-listed Centric Corporation of Canada was given a licence for Block 10BA, adjacent to Ngamia 1, where Tullow has struck oil, in January 2010 and paid the government $615,000 (Sh52 million) mainly in training fees and signing bonuses...Click here