Tullow Oil completes exit from Kenya with USD120 million sale

(Alliance News) - Tullow Oil PLC on Thursday said it has completed the sale of its entire working interest in Kenya to Auron Energy E&P Ltd, an affiliate of Gulf Energy Ltd.

The oil and gas producer in Ghana and the Ivory Coast said it has received the full USD40 million of the first tranche in the sales and purchase agreement.

The transaction, which was announced in July, represents the sale of 100% of the shares in subsidiary Tullow Kenya BV for a minimum cash consideration of USD120 million.

Tullow said the proceeds will be used to strengthen its balance sheet. The sale marks Tullow's exit from the country after 14 years.

The company will retain royalty payments, subject to certain conditions, and a no cost back-in right for a 30% participation in potential future development phases.

"The successful completion of this transaction marks a significant milestone for the company and the achievement of another one of our key 2025 strategic priorities. The use of proceeds helps to further strengthen our balance sheet and I would like to thank the team for their hard work and commitment, which have helped position the company strongly as we look to refinance our capital structure this year," said Chief Executive Officer Ian Perks.

Shares in Tullow Oil closed down 2.3% at 10.88 pence in London on Thursday.

By Michael Hennessey, Alliance News reporter

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