France’s giant oil company Total E&P has acquired a full interest of Tullow, in the Albertine Graben as well as the East African Crude Oil Pipeline. The deal was reached in an agreement.
The overall consideration paid by Total to Tullow will be $575M (about Shs2.2 trillion) with an initial payment of $500M (which is Shs1.9 trillion) at closing and $75M (shs285b) when the partners take the final investment decision to launch the project.
The terms of the transaction have been discussed with the relevant Ugandan government and tax authorities and an agreement in principle has been reached on the tax treatment of the transaction.
Under the terms of the deal, Total will acquire all of Tullow’s existing 33.3334% stake in each of the Lake Albert project licenses.
However, the transaction is subject to the approval of Tullow’s shareholders, to customary regulatory and government approvals and to CNOOC’s right to exercise pre-emption on 50% of the transaction.
Total Chairman and CEO Patrick Pouyanné, says that says the acquisition will enable the company together with their partner CNOOC, to now move the project forward toward the Final Investment Decision for actual oil production.