KAMPALA — French energy major Total plans to launch its 230,000 barrel per day project in Uganda by the end of the year, CEO Patrick Pouyanne said on Friday.
Mr Pouyanne also confirmed Total has finalised plans to acquire all of Tullow Oil’s stake in what is seen as the first significant deal in the oil sector since the price crisis began in earnest in early March.
Tullow agreed to sale its entire stake in jointly-held onshore oil fields in Uganda for $575 million.
Mr. Pouyanne said the company has signed an agreement with the Uganda government on the fiscal framework.
The deal depends on the two companies signing a final tax agreement with the Uganda government and a green light from Tullow’s shareholders. It expects the deal to close in the second half of the year.
Total will pay Tullow more once production has started and once the benchmark Brent oil price reaches $62 a barrel, Total said, compared with around $22 now.
The third partner in the 230,000 barrel per day project, China’s CNOOC, has pre-emption rights for half of the stake sold to Total.