{"id":113692,"date":"2025-04-15T10:04:23","date_gmt":"2025-04-15T10:04:23","guid":{"rendered":"https:\/\/chezaspin.com\/blog\/index.php\/2025\/04\/15\/tullow-sells-entire-kenya-stake-to-gulf-energy-in-120m-deal\/"},"modified":"2025-04-15T10:04:23","modified_gmt":"2025-04-15T10:04:23","slug":"tullow-sells-entire-kenya-stake-to-gulf-energy-in-120m-deal","status":"publish","type":"post","link":"https:\/\/chezaspin.com\/blog\/tullow-sells-entire-kenya-stake-to-gulf-energy-in-120m-deal\/","title":{"rendered":"Tullow Sells Entire Kenya Stake to Gulf Energy in $120M Deal"},"content":{"rendered":"

NAIROBI, Kenya, Apr 15 \u2014 Tullow Oil Plc has signed a major agreement to divest its entire Kenyan operations in a move that marks the company\u2019s complete exit from the East African country. <\/strong><\/p>\n

The deal, valued at a minimum of $120 million, was reached between Tullow\u2019s wholly-owned subsidiary, Tullow Overseas Holdings BV, and Gulf Energy Ltd, a prominent regional energy firm.<\/p>\n

Under the terms of the transaction, Tullow will sell Tullow Kenya BV \u2014 the entity holding all its Kenyan assets \u2014 to Gulf Energy. <\/p>\n

The agreement, currently at the heads of terms stage, includes both immediate and deferred payments, as well as a future royalty structure and a conditional back-in right for Tullow.<\/p>\n

3 tranches<\/h3>\n

The consideration will be paid in three main tranches comprisng USD40mn each.<\/p>\n

Tranche A will be paid upon completion of the transaction, Tranche B upon approval of the Field Development Plan (FDP) or by June 30, 2026 \u2014 whichever comes first, and Tranche Cspread across quarterly payments beginning Q3 2028, contingent on a minimum average Brent crude price of $65 per barrel. <\/p>\n

Any outstanding balance will be paid as a lump sum by June 2033.<\/p>\n

Tranche D will entail additional quarterly royalty payments of $0.5 per barrel, calculated on 80 per cent of total production, subject to oil price and production thresholds.<\/p>\n

Tullow also retains a 30 per cent back-in right, at no cost, for participation in any future development phases, before any government share is factored in.<\/p>\n

Strategic Shift <\/strong><\/h3>\n

Richard Miller, Tullow\u2019s Chief Financial Officer and Interim CEO, called the deal a \u201ckey milestone\u201d in the company\u2019s strategy to reduce debt and sharpen focus.<\/p>\n

\u201cToday\u2019s announcement marks another step forward in Tullow\u2019s accelerated deleveraging journey with near-term cash receipts of $80 million and mitigating significant capital exposure, whilst retaining a material option on the future development of the project,\u201d Miller stated.<\/p>\n

He added that the proceeds, combined with the recent $300 million divestiture of Tullow\u2019s assets in Gabon, would significantly strengthen the company\u2019s balance sheet ahead of a planned refinancing effort.<\/p>\n

Next Steps<\/strong><\/h3>\n

With this deal, Gulf Energy is set to take over all of Tullow\u2019s current and future liabilities related to the Kenyan operations. <\/p>\n

The transaction must still clear several hurdles, including regulatory approvals from relevant Kenyan authorities, payment guarantees for future tranches, and finalization of a detailed Sale and Purchase Agreement (SPA), expected in the coming months.<\/p>\n

Completion is anticipated within 2025, marking the formal transfer of Tullow\u2019s interests \u2014 including its stake in the South Lokichar oil project \u2014 to Gulf Energy.<\/p>\n

Tullow had long been the lead player in Kenya\u2019s quest to become a crude oil producer, but slow progress in commercializing discoveries and shifting corporate priorities have seen it gradually scale back its involvement. <\/p>\n

The transaction now puts Gulf Energy in the driver\u2019s seat for one of Kenya\u2019s most significant energy developments.<\/p>\n

\u201cWe look forward to working with Gulf Energy, who have the requisite financing to complete the transaction and are a strong and credible counterparty, and by doing so, unlock material value for the people of Kenya,\u201d said Miller.<\/p>","protected":false},"excerpt":{"rendered":"

NAIROBI, Kenya, Apr 15 \u2014 Tullow Oil Plc has signed a major agreement to divest its entire Kenyan operations in a move that marks the company\u2019s complete exit from the East African country. The deal, valued at a minimum of $120 million, was reached between Tullow\u2019s wholly-owned subsidiary, Tullow Overseas Holdings BV, and Gulf Energy […]<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-113692","post","type-post","status-publish","format-standard","hentry","category-uncategorized","entry"],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"","jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/posts\/113692","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/comments?post=113692"}],"version-history":[{"count":0,"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/posts\/113692\/revisions"}],"wp:attachment":[{"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/media?parent=113692"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/categories?post=113692"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/chezaspin.com\/blog\/wp-json\/wp\/v2\/tags?post=113692"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}