Tullow Oil plc has signed a sale and purchase agreement for a minimum US$120 million in cash for its Kenya assets with Auron Energy E&P Ltd, an affiliate of Gulf Energy Ltd.
PRIORITY
The portfolio, comprising four onshore blocks in the South Lokichar Basin, represents circa 463 million barrels of 2C resources.
Payment, in three $40m tranches due on certain achievements, will contribute to reducing Tullow’s debt.
The company will also be entitled to royalty payments, subject to conditions, and retains a no-cost back-in right for a 30% participation in potential future development phases.
“We are pleased to announce the signing of the Kenyan SPA, marking another step closer to completion of the transaction with Gulf Energy,” said chief financial officer Richard Miller.
“For a total consideration of at least US$120 million, the transaction supports our strategic priority to strengthen the balance sheet, with the first two payments totalling US$80 million expected before the end of the year.
“We continue to advance plans to optimise our capital structure during 2025.
“Coupled with the sale of our Gabonese assets, the disposal of these non-core assets is expected to provide cash proceeds of US$380 million in 2025.”