Tullow views EGM as key to Uganda buyout bid

TULLOW Oil’s management is still viewing a shareholder vote on Monday as the next key date in its attempts to buy out its partner in two significant assets in Uganda, despite press speculation that the country’s government has indicated it is not in favour of the deal going ahead.

The Irish oil and gas exploration company said at the weekend that it would exercise its pre-emption rights and match Italian energy company Eni’s $1.5 billion (€1.06bn) bid for the 50% stakes in two oil fields in the Lake Albert Rift Basin – in which it owns half shares, itself – from Canadian firm Heritage Oil.

While Tullow said it was entering a sale and purchase agreement with Heritage Oil & Gas, the finalisation of the deal is dependent on approval by Heritage’s shareholders and the Ugandan government itself.

The significance of next Monday is that it is the date when Heritage is due to put the matter to a shareholder vote at an extraordinary general meeting (EGM).

However, a press report in Uganda has suggested that Tullow’s weekend announcement is now hampered because the country’s government will not approve the company’s pre-emption rights.

Tullow chief executive Aidan Heavey said at the weekend that the company’s acquisition of the Heritage stakes would benefit both Tullow shareholders and the Ugandan government’s exploration development requirements. A spokesperson for Tullow said yesterday that the company is still viewing the Heritage EGM, on Monday, as the next key date in the transaction timetable.

Meanwhile, Limerick- headquartered exploration firm, Circle Oil has announced a 21% increase in combined production levels at its Egypt-based Al-Amir SE-4 and Geyad-2X ST1 wells – from 6,070 barrels of oil per day (bopd) to 7,350 bopd.

“This successful appraisal well, once connected, will add to our current production levels,” chief executive David Hough said.