TULLOW OIL will this week sell half its $5 billion (£3.2 billion) stake in one of the biggest oil finds in Africa to a Chinese state company.
The landmark deal with China National Offshore Oil Corporation (CNOOC) will bring Tullow, the FTSE 100 exploration group, a windfall of up to $2.5 billion.
It will also end wrangling over the rights to develop the giant fields in west Uganda. They helped Tullow, founded in 1985 by Aidan Heavey, a former accountant, to double its stock market value to £10.2 billion in the past year.
Final details were being worked out this weekend with Total, the French oil group, which could become an equal partner in the fields with the Chinese and participate in their development. Tullow is expected to announce the deal after Yoweri Museveni, the president of Uganda, gives it his blessing, which is expected this week. The sale of the three blocks — worth between $4.5 billion and $5 billion — in the Lake Albert basin will be part of a larger development plan.
Eni, the Italian giant, had offered to invest $13 billion to bring them into production but cancelled the offer last week after Uganda switched its support to the rival Tullow/CNOOC plan. The deal is likely to include a secondary listing of Tullow’s shares on the Ugandan stock exchange.
The tussle for control began in November when Heritage Oil, Tullow’s 50% partner in two of the fields, sold them to Eni for $1.5 billion. Tullow matched the bid and gained key government backing.
It will also end wrangling over the rights to develop the giant fields in west Uganda. They helped Tullow, founded in 1985 by Aidan Heavey, a former accountant, to double its stock market value to £10.2 billion in the past year.
Final details were being worked out this weekend with Total, the French oil group, which could become an equal partner in the fields with the Chinese and participate in their development. Tullow is expected to announce the deal after Yoweri Museveni, the president of Uganda, gives it his blessing, which is expected this week. The sale of the three blocks — worth between $4.5 billion and $5 billion — in the Lake Albert basin will be part of a larger development plan.
Eni, the Italian giant, had offered to invest $13 billion to bring them into production but cancelled the offer last week after Uganda switched its support to the rival Tullow/CNOOC plan. The deal is likely to include a secondary listing of Tullow’s shares on the Ugandan stock exchange.
The tussle for control began in November when Heritage Oil, Tullow’s 50% partner in two of the fields, sold them to Eni for $1.5 billion. Tullow matched the bid and gained key government backing.
Source: The Times
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