Tullow Gets Ugandan Government Approval for $575m Asset Sale

Tullow Gets Ugandan Government Approval for $575m Asset Sale

Tullow Oil Plc received approval from the Ugandan government for its $575 million sale of assets to Total SE, sending the shares up 17%.

The beleaguered oil and gas explorer had been waiting since 2017 to close the divestment, an effort repeatedly stymied by tax disagreements. As it sought relief from lenders this year to avoid blowing through debt covenants, securing proceeds from the sale became key to restoring stability.

“The Government of Uganda and the Ugandan Revenue Authority have executed a binding tax agreement,” Tullow said Wednesday in a statement. “The Ugandan minister of energy and mineral development has also approved the transfer of Tullow’s interests to Total.”

Tullow shares traded up 2.73 pence at 19.24 pence as of 10:08 a.m. in London.

The company expects the transaction to close in the coming days.

Source: Bloomberg

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Published: 21-10-2020