Tullow Oil finalizes sale of Gabon assets for $300 million

LONDON - Tullow Oil (LON:TLW) plc (Tullow) has officially signed a sale and purchase agreement (SPA) with Gabon Oil Company for a strategic divestment of its Gabonese portfolio, a move aimed at reducing the company’s net debt and focusing on high-margin production. The $300 million transaction involves Tullow’s non-operated working interests in Gabon, which include approximately 36 million barrels of 2P reserves and a production guidance of circa 10 thousand barrels of oil per day for 2025.

The agreement follows Tullow’s announcement on March 24, 2025, and marks a significant step in the company’s capital structure optimization strategy for the year. The completion of the deal, subject to customary adjustments and regulatory approvals, is anticipated around mid-2025.

Richard Miller, Chief Financial Officer and Interim CEO of Tullow, commented on the transaction’s alignment with the company’s objectives to reduce leverage and strengthen the balance sheet. He emphasized the deal’s role in positioning Tullow for organic and inorganic growth, focusing on deepwater operated positions in West Africa.

The divestment is expected to lead to a reduction in pro forma gross profit of about $119 million and operating profit before tax of approximately $120 million, based on 2024 financials. It will also decrease Tullow’s total assets and liabilities by around $256 million and $108 million, respectively.

The SPA stipulates that the sale’s net proceeds will be used to materially reduce Tullow’s net debt, potentially easing the holistic debt refinancing anticipated in 2025. This strategic move is in line with Tullow’s broader strategy of concentrating on self-funded production with strong cash flows.

The transaction is deemed significant relative to Tullow and does not require shareholder approval as per the UK Listing Rules. Peel Hunt LLP is acting as Tullow’s corporate broker, with Norton Rose Fulbright LLP as legal counsel.

The information disclosed is based on a press release statement from Tullow Oil plc.

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