Tullow Oil to proceed with farm-down with CNOOC, Total

Shares in Tullow Oil rose on Friday morning after the firm signed two new production sharing agreements (PSAs) with the government of Uganda, covering the EA-1 and Kanywataba licences in the Lake Albert Rift Basin.

"As a result of this signing, Tullow will now finalise arrangements with CNOOC and Total for completion of the farm-down and the related transfer of monies as soon as possible," the statement said.

In March last year, Tullow, CNOOC and Total signed SPAs whereby CNOOC and Total each farmed into one third of the Lake Albert Rift Basin for a total consideration of $2.9bn.

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Some 1.1bn barrels (P50) of oil has been discovered in the Basin to date and an additional 1.4bn barrels (P50) of prospective resources has been identified, Tullow's website says.

"Today's signing is a vital step towards the development of the Lake Albert Rift Basin and the oil and gas industry in Uganda and East Africa. I look forward to working in partnership with the Government of Uganda and CNOOC and Total as we progress this world-class asset," said Tullow's Chief Executive Officer Aidan Heavey.

Shares were up 3.8% at 1,495p in early trading.

BC