According to James Stafford an editor at Oilprice.com Kenya is set to be the largest oil producer in East Africa. This is despite security and political challenges in the country.

Six of the last 10 biggest finds have been in Africa. There are some 130 billion barrels of crude oil waiting to be tapped by more than 500 companies, according to a recent report by PriceWaterhouseCoopers. Topping this list are Kenya’s Anza and South Lokichar basins where the discovery and development news has been fast-paced.

In the last days of August, Tullow Oil—the British explorer behind Kenya’s oil discovery debut in 2012—announced another oil find that will extend the already proven South Lokichar basin “significantly northwards”. This is the basin where in May this year Tullow and partner Africa Oil Corporation made public the country’s first commercial oil discovery worth US$ 10 billion.

The next testing ground will be the neighboring Kerio Basin, which should get off the ground later this month.

Africa Oil and Marathon are currently drilling an appraisal well on the Sala gas discovery in the Anza Graben Basin onshore Kenya. This will benefit other explorers with acreage just south of this, including UK-listed Afren Plc, UK-listed Tower Resources and Taipan Resources Inc.

In the Ogaden Basin,  Afren released estimates late last month that a large under-explored sub-basin, El Wak, contains up to 6.65 billion barrels of oil. If this estimate is accurate—and it comes in well above partner Taipan Resources’ earlier estimates of about a quarter of that—they would be looking at the largest onshore target ever drilled anywhere in Africa. Later this year, Afren will be conducting seismic surveys to further define El Wak’s potential, and investors in the global oil sector will be watching closely.

Kenya has an advantage over its neighbors due to a convergence of add-on factors, including infrastructure aims, relative stability and what appears to be a smarter use of natural resources to generate more investment and economic growth. This is according to Jennifer Cooke of the Center for Strategic and International Studies.

Among other planned infrastructure projects of a massive scale, discussions are under way for a pipeline from neighboring Uganda, which would pass through the South Lokichar basin and come close enough to some of the prime drilling areas that could be the site of Kenya’s next discoveries.

In the meantime, political stability has also been given a slight reprieve with the International Criminal Court’s (ICC) indefinite adjournment of the trial against Kenyan President Uhuru Kenyatta due to lack of evidence that he organized post-election ethnic violence in 2007.

But the security situation with the regrouping of the Somalia-based al-Shabaab militant group and an uptick of the group’s apparent attacks on Kenya continue to be problematic, even more so because no one seems to be sure whether the threat is emanating entirely from al-Shabaab.

While this remains a clear threat, it has not affected exploration and development—and it certainly has done little to scare foreign investors from this hydrocarbon frenzy that is expected to continue over the next five years, further boosted by relatively cheap exploration licenses in the region.

In this race, Kenya is the top contender, moving forward at double the speed of neighboring Uganda which discovered oil in 2006, six years before Kenya, but will lag a year behind the newcomer in terms of commercial production.

To read James' full article, click here

With commercial oil production Kenya will benefit from increased foreign exchange inflows, increased foreign direct investment and increased government revenues. All of these being indicators of a better economy.

*second last paragraph added on 25/09/14 at 3.32 pm Kenyan time*