Tullow Oil moved closer to exiting its Kenyan operations, announcing Monday the signing of a sales and purchase agreement with Gulf Energy.
The U.K.-listed oil and gas explorer in April 15, 2025 agreed to sell its local oil deposits to Nairobi-based Gulf Energy for at least $120 million (Sh15.5 billion) as it strives to reduce its debt.
Managing director of Tullow Kenya BV, Madhan Srinivasan confirmed the signing of the agreement with Gulf affiliate Auron Energy E&P Ltd. in a statement.
It signed a sale and purchase agreement (SPA) with Tullow (as guarantor for the Seller), Auron Energy E&P Limited (the “Purchaser”), an affiliate of Kenya’s Gulf Energy Ltd.
Srinivasan said the signing of the SPA marks a pivotal milestone in the ongoing transaction and brings the sale closer to completion.
In the transaction, Gulf Energy Ltd shall act as guarantor for the Purchaser (the “Purchaser Guarantor”) for the sale and purchase of 100% of the shares in Tullow Kenya BV (“Tullow Kenya”), which holds Tullow’s
entire working interests in Kenya (the “Disposed Assets”) for a minimum cash consideration of US$120 million (the “Transaction”), subject to customary adjustments.
The consideration will be split into a US$40 million payment due on completion, US$40 million payable at the earlier of Field Development Plan (FDP) approval or 30 June 2026, and US$40 million payable over five years from the third quarter of 2028 onwards.
Additionally, Tullow will be entitled to royalty payments, subject to certain conditions. Tullow also retains a no-cost back-in right for a 30% participation in potential future development phases.
