Tullow Oil announced that it signed a memorandum of understanding with Uganda that lets it move forward with energy development in the country.
Heritage Oil in 2009 agreed to sell its Ugandan holdings to Italian energy company Eni. Tullow had the right to pre-empt the deal, however, and in early 2010 the Ugandan government said it backed Tullow’s plans despite a lobbying campaign by Eni to stop the transaction.
Tullow said the acquisition created conditions for French energy company Total and the China National Offshore Oil Corp. to join the work in the Lake Albert basin in Uganda.
Tullow said the MOU means the government of Uganda gave its consent to the purchase and resolves an impasse created by the Heritage and Tullow tax situations.
“This agreement satisfies the government of Uganda’s taxation concerns and enables Tullow, CNOOC and Total to proceed with the basin-wide development with the full support and commitment of the government of Uganda,” the company said in a statement.
Tullow said in the wake of the deal with Heritage that accelerated development in the region could yield as much as 200,000 barrels of oil per day from the Lake Albert basin
