Tullow finally seals $2.9bn Uganda deal
OIL firm Tullow Oil said yesterday a long-awaited $2.9bn (£1.8bn) deal to bring in French oil major Total and Chinese group CNOOC as partners to develop its oil fields in Uganda closed yesterday, paving the way for commercial oil production to start in the African country.
The conclusion of the deal marks the transfer of $2.9bn to Tullow from Total and CNOOC, after repeated delays following the initial announcement of the deal early in 2010, and the signing of the sale agreements in March 2011.
The British group will now focus on its $10bn plan to start pumping oil from huge reserves discovered on the shores of Lake Albert.
Early production is scheduled to start in 2013 before ramping up to a major production phase in 2016, Tullow said.
The final closing of the deal had been expected following Tullow’s signing of two production-sharing agreements with Uganda earlier in February.
FTSE 100-listed Tullow’s shares dipped in early trading yesterday after a drilling update on its Jupiter-1 deep-water discovery well in Block SL-07B offshore Sierra Leone, operated by Anadarko Petroleum, was poorly received by investors.
Westhouse Securities said in a note that the data provided by the company was inconclusive.