UK’s Tullow Oil to sell Kenya assets for at least Sh15 billion

West Africa-focused oil and gas explorer Tullow Oil said on Tuesday it would sell its assets in Kenya to Gulf Energy Ltd for at least Sh15.5 billion as it works to reduce its debt.

Tullow will get three Sh5 billion payments, be entitled to royalty payments and have the right to 30% participation in potential future development phases at no cost, it said in a statement.

The company’s Kenyan oilfields have not been brought into full production as any export route would require building hundreds of miles of a heated pipeline to the coast. It recorded a Sh18.8 billion write-off on these operations last year.

In May 2023, the UK-listed company became the sole owner of the Lokichar oilfield after its license partners TotalEnergies and Africa Oil Corp withdrew, and sale, talks with Indian state-run companies did not result in a deal. Last month,

Tullow agreed to sell its working interests in Gabon for Sh38 billion in cash.

It had net debt of around Sh194 billion at the end of last year.

The company had a market capitalisation of around Sh33 billion as of Tuesday.