Kenya shutdown cools east African oil ambitions

|By:, SA News Editor

Tullow Oil's (TUWLF, TUWOY) suspension of drilling in Kenya after weekend protests shows how popular impatience for a share of the spoils is compounding the problems energy firms face building an oil and gas industry from scratch in east Africa.

While the suspension is a blow to Kenya's government, investor confidence is another casualty; while east Africa is new hot new spot for oil and gas exploration, excitement has been tempered by wrangles with governments, gaps in regulations and rickety infrastructure.

Local populations are understandably anxious for a windfall, but production may be years away, and such disruptions are more likely to slow the area's emergence as a significant producer, a Reuters analysis says.