This archive report was first published on 23 April 2020.
On April 23, 2020, French oil company Total announced its acquisition of Tullow's entire interests in Uganda's oil sector, marking a significant milestone in the country's oil industry.
According to Total, the acquisition includes Tullow's 33.3 percent stake in Uganda's oil sector, as well as its share in the East African Crude Oil Pipeline.
Under the terms of the agreement, Total will pay $575 million (approximately Sh62 billion) to acquire Tullow's shares.
The French company will make an initial payment of $500 million (approximately Sh54 billion) at closing and $75 million (approximately Sh8 billion) when the partners take the Final Investment Decision to launch Uganda's oil project.
Conditional payments will be made to Tullow linked to production and oil price, which will be triggered when Brent prices are above $62 a barrel.
The transaction is subject to, among other issues, China National Offshore Oil Corporation's (CNOOC) right to exercise pre-emption on 50 percent of the transaction.
"The sale of our Uganda assets is an excellent first step towards our target of raising over 1 billion dollars of proceeds to reduce net debt, strengthen the balance sheet and secure a more conservative capital structure," said Dorothy Thompson, executive chair of Tullow Oil plc.
