London-based oil explorer Tullow Oil has sought to delay the deadline by which it must decide whether to pre-empt its partner Heritage Oil’s $1.5 billion sale of its Uganda assets to Italy’s ENI, sources close to the matter said on Friday.
Tullow has initiated legal proceedings to push the deadline beyond Sunday January 17, the sources said.
“The idea was to get a short delay, but they are still very, very seriously considering pre-empting,” one source said, adding Tullow faced no difficulty securing finance.
Banking sources said Tullow would have little difficulty raising the $1.5 billion needed, given the extent of proven oil reserves at the fields around Lake Albert.
Tullow and Heritage declined to comment.
Another source said Tullow had sought to amend the pre-emption rights so it could buy Heritage’s interest in just one of the blocks.
Heritage owns 50 percent of Block 1 and 50 percent in Block 3A, while Tullow owns the rest. Tullow also owns 100 percent of Block 2. The blocks cover the Uganda side of Lake Albert.
Tullow has said it started a process to sell up to 50 percent of its own Ugandan assets, with a buyer expected to be selected early this year.
Sources close to the company have said that if it bought Heritage’s interests, these would be included in the sale process, to offer a larger stake to prospective buyers.
A majority stake in the three blocks would be more attractive to a big international oil company or Asian state oil company than the up to 25 percent stake currently being marketed by Tullow, analysts said.
ENI agreed to purchase the fields in December, reflecting the growing interest shown by international oil companies in Uganda.
Reuters.