This follows Tullow exercising its right of pre-emption on January 17, 2010 and the approval of the transaction by Heritage shareholders. The terms of the transaction include a consideration of $1.35bn cash and a further contingent, deferred consideration of up to $150m cash or an interest in a mutually agreed producing oil field independently valued at a similar amount.
The SPA contains various conditions, including the approval of Tullow Uganda as the purchaser by the government of Uganda. Tullow will now work closely with Heritage, HOGL and the government of Uganda to expedite the approval process, which is expected to be completed in the first quarter of 2010.
The company said that in parallel with the HOGL asset purchase process, with the government support, it has been running a transparent farmout process which has attracted interest from international and national oil companies. Tullow is currently discussing preferred partners with the government and expects to complete this transaction in parallel with the purchase from HOGL and Heritage.
