Tullow Oil plc announced that it has reached an agreement with the Government of Gabon to regain its 7.5 per cent stake in the Onal Complex producing fields and the Ezanga block (formerly the Omoueyi exploration block).
The agreement is sequel to a decision last year by Gabon oil minister, Etienne Ngoubou to lock Tullow out of negotiations on the renewal of a license on Onal, which effectively seized the company’s 7.5 per cent stake.
As part of the new deal, Tullow has been granted license extensions in the Onal Complex fields until 2034 and has gained access to two small oil discoveries made within the Ezanga block in 2014.
In return for access to these discoveries, it was also agreed that the effective date of the new license will be August 1.
The latest development allows Tullow to maintain full year production guidance for West Africa at 66,000-70,000 barrels of oil per day.
Tullow increased its production guidance for West Africa earlier this year from 63,000-68,000 barrels of oil per day, as a result of strong performance from its Jubilee field offshore Ghana.
Tullow Oil plc Chief Executive Officer, Aidan Heavey, stated in a company statement: “I am very pleased that this deal has been agreed which guarantees Tullow’s long-term future in Gabon. We have had operations in Gabon for over ten years and I look forward to investing further in Gabon over the coming decades. Our West African non-operated portfolio, which has Gabon at its heart, continues to perform exceptionally well, providing important and stable production for the group.”
Analysts at Citigate Dewe Rogerson Ltd stated that although the renewal of the Onal Complex production license is a “relatively low impact event”, it underlines Tallow’s ability “to work with African governments to secure and retain upstream assets”.