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Uganda: Total-Tullow Oil Sales Deal Awaits Cabinet Approval

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Last month's French oil giant Total E&P acquisition of Anglo-Irish Tullow assets awaits Cabinet approval before it can be endorsed by government, the Ministry of Energy has said.

Ms Kitutu also showed optimism that they were looking at Final Investment Decision (FID) by the oil companies taken by August or latest, by the end of the year, especially following the Total E&P/Tullow sales deal, which once approved, will allow investment decisions to start.

Total E&P announced last month that it had acquired Tullow's remaining 33.33 per cent stake for Shs2.1 trillion ($575m), with Shs1.8 trillion ($500m) paid once the deal has been approved by government, and the balance of Shs780 billion ($75m) paid whenever the FID has been reached.

To start oil production, projections show that the oil companies, Total E&P and Cnooc, have to invest a minimum capital of $10b (Shs36 trillion); $6.7b (about Shs24 trillion in developing the oil fields--Tilenga fields in Nwoya/Buliisa districts and Kingfisher in Kikuube, and $3.55b (Shs13 trillion), for the export pipeline from Hoima to Tanga in Tanzania.

First oil production, both government and oil companies, say is three years from FID, which remains uncertain now.

Source: allAfrica.com

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