By:Zawya

West Africa-focused oil and gas explorer Tullow Oil said on Tuesday it would sell its assets in Kenya to Gulf Energy Ltd for at least $120 million as it works to reduce its debt.

Tullow will get three $40 million payments, be entitled to royalty payments and have the right to 30% participation in potential future development phases at no cost, it said in a statement.

The company's Kenyan oilfields have not been brought into full production as any export route would require building hundreds of miles of a heated pipeline to the coast. It recorded a $145 million write-off on these operations last year.

In May 2023, the UK-listed company became the sole owner of the Lokichar oilfield after its license partners TotalEnergies and Africa Oil Corp withdrew and sale talks with Indian state-run companies did not result in a deal.

Last month, Tullow agreed to sell its working interests in Gabon for $300 million in cash.

It had net debt of around $1.5 billion at the end of last year. The company had a market capitalisation of around $255 million as of Tuesday.