Page 8 - AfrOil Week 12 2022

AfrOil INVESTMENT AfrOil

Tullow completes acquisition of extra

shares in Jubilee, TEN from Occidental

GHANA TULLOW Oil (UK/Ireland) reported on Mon- about a month after Occidental announced
day (March 21) that it had finalised its acqui- plans to sell its stakes in Jubilee and TEN to Kos-
sition of additional stakes in the Jubilee and mos Energy (US), a non-operating partner in
Tweneboa-Enyenroa-Ntomme (TEN) oilfields both projects.
offshore Ghana. It was able to close the transaction after
In a statement, Tullow noted that it had securing approval from the Ghanaian gov-
acquired the stakes from Occidental Petroleum ernment and finalising agreements with both
(US) and was exercising its rights as the operator Kosmos and Anadarko, the US-based firm that
of both projects. It also said that it had paid cash Occidental bought in April 2019. (Occidental
consideration of $118mn for both stakes upon has been working to unload part of Anadarko’s
the completion of the transaction, reflecting portfolio since that acquisition.)
adjustments to the closing price, and had cov- In the statement, Tullow’s CEO Rahul Dhir
ered the payment using cash on its balance sheet. thanked Ghana’s government, along with
As a result of the acquisition, Tullow’s equity Energy Matthew Opoku Prempeh, for their
stakes in Jubilee and TEN will rise to 38.9% and support.
54.8%, respectively. “I am delighted that this important trans-
This will raise the company’s total unhe- action has been completed, and I am grateful
dged production by around 5,000 barrels per for the continued support of the government
day (bpd), or about 4,000 bpd on an annualised of Ghana and, in particular, the honourable
basis. It will also raise Tullow’s total projected minister of energy, whose leadership has been
output to 59,000-65,000 bpd in 2022, with its paramount in getting to completion,” he com-
net share of Jubilee climbing to 30,000-32,000, mented. “This transaction underscores our con-
its net share of TEN moving up to 13,000-14,000 fidence in the assets and meets our objectives of
and net shares from non-operated fields remain- value accretion and deleveraging.” ™
ing steady at 16,000-19,000 bpd.
Tullow’s capital expenditures will also rise as
a result of the acquisition, moving up from the
originally projected level of $30mn to $350mn
in 2022, the statement said. It also reported,
though, that the new reserves would generate
about $300mn in additional incremental cash
flow between 2022 and 2026, assuming an aver-
age oil price of $75 per barrel.
Meanwhile, the acquisition is also slated
to boost Tullow’s 2P (proven and probable)
reserves by approximately 21mn barrels of
oil equivalent (boe) as of December 31, 2021.
The additional reserves will have an estimated
after-tax NPV 10 (net present value discounted
by 10%) valuation of $355mn, assuming an oil
price of $75 per barrel, the company stated.
Tullow initiated the deal last November, Tullow now has stakes of 54.8% and 38.9% in TEN and Jubilee (Image: Tullow Oil)

IOCL eyes South Lokichar project in Kenya

KENYA INDIAN Oil Corp. Ltd (IOCL) has reportedly looked into the possibility of coming on board
considered investing in Tullow Oil’s $3.4bn as a strategic partner in the upstream project, as
South Lokichar project field in Turkana county, well as in the construction of an 825-km heated
in northwestern Kenya. oil export pipeline from Turkana county to the
According to a Bloomberg report, IOCL has coastal port of Lamu.

P8 www. NEWSBASE .com Week 12 23•March•2022