LONDON, Feb 21 (Reuters) - British oil firm Tullow Oil said a long-awaited $2.9 billion deal
to bring in French oil major Total and Chinese group CNOOC as partners to develop its oil fields in Uganda closed on Tuesday, paving the way for commercial oil production to start in the African country.
The conclusion of the deal marks the transfer of $2.9 billion to Tullow from Total and CNOOC, after repeated delays following the initial announcement of the deal early in 2010, and the signing of the sale agreements in March 2011.
The group will now focus on their $10 billion plan to start pumping oil from huge reserves discovered on the shores of Lake Albert. Early production is scheduled to start in 2013 before ramping up to a major production phase in 2016, Tullow said.
'Tullow, CNOOC and Total have been working closely since March 2011 on development options for the Lake Albert Basin and are looking forward to discussing them with the government of Uganda later this year,' Tullow said, adding that it will now restart drilling in the area.
The final closing of the deal had been expected following Tullow's signing of two production-sharing agreements with Uganda earlier in February.
A tax dispute between Kampala and Heritage Oil, Tullow's former partner in the oil fields, as well as wrangling over details connected to the production sharing agreements, resulted in delays to the deal's progress.
The cash boost will be welcomed by Tullow, which said in January capital expenditure would be $2 billion this year.
Shares in Tullow traded down 3.4 percent to 1,546 pence at 1211 GMT, impacted by an earlier mixed drilling result at a well off the coast of Sierra Leone.
(Reporting by Sarah Young; Editing by Rosalba O'Brien) Keywords: TULLOWOIL/
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