Tullow Oil has exited Kenya’s upstream oil sector, completing the sale of its entire working interest to Auron Energy E&P Ltd, an affiliate of Gulf Energy, for a minimum cash consideration of US$120 million (approx. Sh15.6 billion).
The transaction, announced on the London Stock Exchange, marks a major milestone for Kenya’s energy ambitions, with Gulf Energy now assuming full control of the Turkana oil project, bringing the country closer to producing its first oil.
Deal Terms and Strategic Implications
Tullow confirmed receipt of US$40 million under Tranche A of the Sale and Purchase Agreement (SPA), originally announced on 21 July 2025. The deal includes:
- Sale of 100% shares in Tullow Kenya BV
- Retention of royalty payments (subject to conditions)
- A no-cost back-in right for 30% participation in future development phases
“The transaction represents the sale of 100% of the shares in Tullow’s subsidiary Tullow Kenya BV, which holds Tullow’s entire working interests in Kenya,” said Madhan Srinivasan, Managing Director, Tullow Kenya BV. “We are delighted to pass the baton to Gulf Energy, a capable Kenyan company, in the lead-up to first oil.”
Gulf Energy Steps In: Local Stewardship for National Energy Goals
Gulf Energy CEO Paul Limoh welcomed the acquisition, stating:
“This project will play a crucial role in advancing Kenya’s domestic energy sector, creating opportunities for growth in Turkana and supporting long-term energy security.”
The company plans to work closely with stakeholders to accelerate development, positioning Kenya as a future oil-producing nation.
Tullow Refocuses Strategy
Tullow CEO Ian Perks described the sale as a strategic win:
“The successful completion of this transaction marks a significant milestone and strengthens our balance sheet as we prepare to refinance our capital structure.”
Tullow expressed gratitude to the Ministry of Energy and Petroleum, EPRA, and the County Government of Turkana for their support since 2011.
Market Outlook
The transfer of assets to Gulf Energy signals:
- Renewed momentum for Kenya’s upstream oil sector
- Increased local ownership and stewardship
- Potential acceleration toward first oil production
With the Turkana basin now under Kenyan leadership, industry watchers anticipate fresh investment, regulatory clarity, and infrastructure development to unlock the region’s full potential.
