Tullow in talks to exit Namibia's Kudu gas project in investment shift

10/31/2014

Tullow in talks to exit Namibia's Kudu gas project in investment shift

NIDAA BAKHSH

LONDON (Bloomberg) -- Tullow Oil Plc, a UK exploration company, is in talks with Namibia’s government to withdraw from the $2 billion Kudu gas project as it shifts investments to other parts of Africa.

Tullow, which has a number of large oil developments in western and eastern Africa, needs to allocate capital to those, the London-based company said Oct. 31 in an email. Tullow has a 31% stake in the Kudu project.

“It is clear that these developments rank higher than Kudu,” it said. “However, Kudu remains an excellent project for Namibia and we are committed to assisting the government in moving it forward.”

The Kudu field holds about 1 Tcf of gas and is located 200 km (124 miles) off the southern town of Oranjemund. Gas from the field would be used in a power station to generate electricity in 2018.

Itochu Corp., which also has a stake in Kudu, may also pull out, prompting Namibia to approach China Africa Development Fund and China National Offshore Oil Corp., Namibia Press Agency reported Oct. 31, citing Mines and Energy Minister Isak Katali.

Tullow has interests in the giant Jubilee field in Ghana. It plans to invest about $1 billion to explore for oil in Mauritania, Kenya, Ethiopia and Norway and drill its first well off Guinea.

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