Tullow Oil PLC on Tuesday said it has sold all its interests in Kenya to local firm Gulf Energy Ltd for $120 million plus potential royalties.
The sale of the assets in East Africa leaves the oil and gas producer focused on the West African countries of Ghana and Ivory Coast, having also sold its Gabon interests late last month.
Tullow said it will receive $40 million for Tullow Kenya BV from Gulf Energy upon completion, another $40 million by the end of June next year, and a final $40 million over five years from the third quarter of 2028 onwards.
Tullow also may benefit from royalty payments, and it has a ’back-in right’ for a 30% participation in potential future development phases of the Kenyan assets. Gulf Energy also will take on all past and future liabilities for the assets.
Nairobi-based Gulf Energy is the largest supplier of petroleum products into Kenya and inland East African markets, Tullow noted. It also is involved in power generation and industrial construction.
In Tullow’s 2024 accounts, released last month, the company took a $145 million write-off of exploration costs, primarily for the assets in Kenya.
At the time, Tullow also said it had agreed to sell all of its assets in Gabon to Gabon Oil Co for $300 million in cash.
Tullow shares were up 2.7% to 13.72 pence on Tuesday morning in London. They are down 62% over the past 12 months.
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