Cnooc, Total To Buy Uganda Stakes For $2.9B

Cnooc CEO, China's largest offshore oil driller, and France's Total TOT, Europe's third-largest oil company, will pay a combined $2.9 billion to acquire stakes in Uganda from U.K.-based Tullow Oil in deals that will end a tax debate that has delayed Tullow's development of the oil-rich Lake Albert region in the African country. Tullow, which is hoping to produce 200,000 barrels of oil per day from the venture, will retain a one-third stake in the project. The agreement includes Tullow's interests in Exploration Areas 1, 2 and 3A in Uganda. New licenses have also been given for EA-1 and an onshore area of EA-3A, as well as the rights to develop the Kingfisher discovery, according to Bloomberg News. Cnooc, China's third-largest oil producer, will pay $1.47 billion for its stakes in Exploration Areas 1, 2 and 3A. The company expects the deal to close in the first half of this year. "The transaction signifies another milestone for Cnooc to grow its overseas business by entering into Lake Albert Rift Basin, one of the key frontier basins in East Africa," Cnooc CEO Yang Hua said in a statement issued by the company.