Business
US$180m Sale of Assets in West Africa to Panoro
US$180m Sale of Assets in West Africa to Panoro.
About this update from Tullow Oil Plc
[{"type":"text","content":"\n \n \n \n RNS Number : 5165O\n Tullow Oil PLC\n 09 February 2021\n \n \n \n TULLOW OIL PLC\n \n Tullow agrees US$180 million sale of assets in west africa to Panoro\n \n \n 9 February 2021 - Tullow Oil plc (Tullow) is pleased to announce that it has signed two separate sale and purchase agreements with Panoro Energy ASA (Panoro) for all of Tullow's assets in Equatorial Guinea (the EG Transaction) and the Dussafu asset in Gabon (the Dussafu Transaction).\n Rahul Dhir, Chief Executive Officer of Tullow, and Les Wood, Chief Financial Officer, will host a call for investors at 9am UK time on 10 February 2021. The dial-in details for this call can be found at the end of this press release.\n Transaction Highlights\n \n · US$180 million asset sales consisting of up to US$105 million for the EG Transaction, up to US$70 million for the Dussafu Transaction and a further US$5 million consideration to be paid after both transactions have completed.\n \n o EG Transaction: US$89 million upfront cash consideration subject to customary completion adjustments; contingent cash payments of up to US$16 million linked to asset performance and oil price.\n \n o Dussafu Transaction: US$46 million upfront cash consideration subject to customary completion adjustments; contingent cash payments of up to US$24 million linked to asset performance and oil price.\n \n · Sale of c. 6,000 bopd of 2021 production and c. 20 million barrels of 2P reserves, with an effective date of 1 July 2020.\n \n · Government of Equatorial Guinea has approved the EG Transaction and confirmed that no tax arises on the disposal.\n \n · Completion of both transactions and receipt of funds is expected in the first half of 2021.\n Strategic and Financial Impact\n \n · These are value accretive transactions which further strengthen the balance sheet and are in line with Tullow's strategy of focusing on high-margin, self-funded production with strong cash flows.\n \n · These transactions will have a neutral impact on Group's 2021 operating cashflow at US$50 / barrel and increase Tullow's 2021 pre-financing free cash flow by c. $0.1 billion; US$129 million of longer-term decommissioning liabilities assumed by the purchaser.\n \n · Important steps in reducing net debt and enabling the Group to deliver US$1 billion of self-help in two years through asset sales, expl...