Tullow Oil has entered a binding agreement to sell its Gabon assets to Gabon Oil Company for $300m (£232.34m) net of tax.
The transaction is expected to close by mid-2025 and is part of Tullow’s plan to reduce debt and streamline operations.
The sale includes Tullow’s entire Gabonese portfolio, which comprises approximately 10,000 barrels of oil per day of 2025 production guidance and around 36 million barrels of 2P (proven) reserves.
The effective date for the transaction was set for 1 January 2025, with the sale and purchase agreement (SPA) targeted for the second quarter (Q2) of 2025.
Tullow anticipates that the transaction will reduce its net debt to $1.15bn on a pro forma basis as of the effective date.
The completion of the transaction is subject to necessary approvals from government ministries, the CEMAC Competition Commission and compliance with Gabonese dividend processing requirements.
Tullow chief financial officer and interim CEO Richard Miller said: “This value accretive transaction with Gabon Oil Company (GOC) aligns with our strategic priorities to materially accelerate deleveraging and is an important step as we progress our refinancing plans this year. Together with GOC, we are focused on finalising the full suite of documentation and driving the transaction to swift completion.
“Our strengthened balance sheet, repayment of our 2025 senior notes and imminent return to drilling at Jubilee, combined with production optimisation activities in the first quarter of 2025, demonstrates our continued delivery against our business objectives and positions the company strongly for the year ahead.”
In addition to the asset sale, Tullow Oil recently received a favourable ruling from an International Chamber of Commerce Tribunal.
The ruling determined that the Branch Profit Remittance Tax (BPRT) does not apply to Tullow’s operations in Ghana, relieving the company of a $320m tax assessment by the Ghana Revenue Authority.
The tribunal’s decision confirms that Tullow’s operations including the Jubilee and TEN fields offshore Ghana are not subject to the BPRT tax regime outlined in the Petroleum Agreements.
