(Bloomberg) – Tullow Oil Plc and Kenya’s Gulf Energy Ltd. have secured an extension to submit a development plan for fields in Kenya, a crucial step to completing a sale of the assets.
Tullow agreed to sell the oil deposits to the Nairobi-based trading firm in April, after struggling for more than a decade to bring them on stream. The $120 million deal was welcomed by investors eager to see Tullow’s debts come down, but it’s dependent on submission of a plan to get the oil flowing.
The companies have been granted a six-month extension until December, Daniel Kiptoo, director-general of Kenya’s Energy and Petroleum Regulatory Authority, said by phone. While the regulator hopes progress will be made sooner, it does expect Gulf Energy to change several aspects of the plan before filing, he said.
Gulf didn’t immediately respond to a request for comment. Tullow said June 30 that the sale agreement is expected to be signed “in the near term.” The London-based oil company, which is also divesting assets in Gabon to shore up funds, didn’t respond to an email on Monday.
