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Tullow Oil plc has reached a preliminary agreement to offload its entire Kenyan assets to Gulf Energy Ltd for a minimum of $120 million.
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The deal, carried out via Tullow’s subsidiary, Tullow Overseas Holdings BV, will transfer ownership of Tullow Kenya BV, which holds all of the company’s Kenyan interests.
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The agreement involves an upfront cash payment of $80 million—split into $40 million at deal closure and another $40 million by June 2026 or upon approval of the Field Development Plan (FDP), whichever occurs first. An additional $40 million will be paid in quarterly installments between 2028 and 2033, contingent on oil price benchmarks.
Tullow retains the right to rejoin the project’s future development phases with a 30% interest at no cost and could receive royalties based on future oil output and market prices.
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Subject to final documentation and regulatory approvals, the deal represents a major step in Tullow’s plan to reduce its debt. It also shifts all existing and future obligations to Gulf Energy, a prominent Kenyan player in energy and infrastructure.
Interim CEO Richard Miller described the move as a key milestone in the company’s financial restructuring, highlighting that combined proceeds from this Kenyan exit and the earlier $300 million Gabon divestiture will aid ongoing refinancing efforts.
The deal is expected to be finalized, and the initial payment released, later in 2025.
