(EnergyAsia, February 24 2012, Friday) — China’s CNOOC Limited and France’s Total said they have completed their purchases of one-third stakes in three exploration sites in Uganda owned and operated by UK’s Tullow Oil plc.

The two companies paid a total of US$2.9 billion for their stakes in Exploration Areas (EA) 1, 2 and 3A.

With the completion of the deal, CNOOC Limited said it will operate the new Kanywataba licence in the former EA 3A, and the Kingfisher production licence which was converted following the discovery in the former EA 3A. Tullow and Total will operate EA 2 and EA 1 respectively.
 
Tullow said it has been working with its new partners since March 2011 on development options for the Lake Albert Basin and will follow that up with discussions with the government of Uganda later this year before embarking on major production within 36 months of gaining official approval expected in 2013.

Tullow said it expects to start producing oil and gas to feed the local power market from next year.

Aidan Heavey, Tullow’s CEO, said:

“I am delighted that we have completed this farm-down with CNOOC Limited and Total, two experienced partners with whom we have already built a strong working relationship. The Lake Albert Rift Basin is one of Africa’s most exciting oil discoveries.”
 
Tullow has interests in over 90 exploration and production licences across 22 countries and focuses on four core areas: Africa, Europe, South Asia and South America.
Li Fanrong, CNOOC Limited’s CEO, said:

“We are delighted to see the completion of this important transaction which will not only add value to our shareholders but also bring social welfare to the people of Uganda. CNOOC Limited will work closely with our project partners and the government of Uganda to expedite the development programme.”

Separately, the three partners are said to be in talks with the government to build Uganda’s first oil refinery. The proposed US$1.5 billion project will be located in the Lake Albert rift basin in western Uganda.