Cnooc bids to increase oil shareholding as Tullow exits

Total and Tullow Oil officials pose with Energy minister Irene Muloni (centre) after signing Memoranda of Understanding in Kampala last month. PHOTO BY STEPHEN OTAGE

What you need to know:

  • Last month, Total and Cnooc, awarded contracts to Flour (France) working with China Petroleum Engineering and Construction Corporation (CPECC), Technip (France), and Chicago Bridge & Iron Company (US) for studying and designing (Front End Engineering Design (FEED) the Buliisa and Kingfsher fields.
  • FEED is the last preparatory stage that will detail technical requirements among others layout of the 36 well pads, technology required for drilling the 400 wells, and estimated costs of required infrastructure to start production.

Kampala. Chinese state-owned China National Offshore Oil Corp (Cnooc) has expressed desire to expand its foothold in Uganda by acquiring half of the 21.57 shares UK’s Tullow Oil Plc recently sold to France’s Total Total E&P.
Tullow disclosed on Friday that Cnooc had “exercised its pre-emption rights under the joint operating (JV) agreements” and notified them of plans to acquire the shares “ on the same terms and conditions that were agreed between Tullow and Total two months ago – including as to the amount, structure and timing of the of the consideration payable to Tullow.”
Pre-emption of right refers to the practice of existing shareholders being given first priority by another shareholder to the right of purchase new shares issued.

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