The transaction process continues, with tax procedures to come next. Tullow Oil PLC ( LON:TLW ) told investors that China’s state oil firm has decided not to exercise pre-emption rights which would’ve seen it jump into the Uganda asset sale to Total, announced last month.
In April, Tullow announced a US$575mln transaction with Total, with Tullow due US$500mln of upfront cash upon completion.
China National Offshore Oil Company (CNOOC), a partner in the project, had the right to acquire 50% of the assets on equivalent terms but has chosen not to increase its stake.
Tullow added that it continues to expect the transaction to complete in the second half of 2020.
It added: “The transaction remains subject to a number of conditions, including approval by Tullow’s shareholders, customary government and other approvals and the execution of a binding tax agreement with the Government of Uganda and the Uganda Revenue Authority that reflects the agreed tax principles previously announced.”
“Tullow will now look to progress the tax agreement following CNOOC’s decision not to pre-empt.”