The company plans to pre-empt a $1.5bn (£918m) bid by Italy’s Eni to acquire its partner’s stake in the oil concession.
Tullow, in partnership with Heritage Oil, has discovered over 700 million barrels of proven oil reserves in three drilling blocks at the Lake Albert Rift basin of Uganda and 1.5 billion barrels of potential reserves.
Tullow has started the process of selling its 50% stakes in Block 1 and 3A, and a 100% stake in Block 2 to attract companies with the necessary experience for developing infrastructure for oil exploitation.
Tullow, through the pre-emption right, has now decided to increase its share in Ugandan assets and block ENi’s bid to buy Heritage’s interest in the oil blocks. Late last year Heritage proposed to sell its stakes in Blocks 1 and 3A to ENI for $1.5bn.
Tullow Uganda will now sign a Sale and Purchase Agreement with Heritage Oil & Gas pursuant to its pre-emption right. The agreement is subject to approval by Heritage shareholders and the Ugandan Government.
If the agreement is completed, Tullow will own all three blocks in Uganda.
Tullow has also initiated a farmout process that has attracted interest from key global and national oil companies.