Tullow Says Kosmos to Stay in Ghana Until Production Starts

April 22 (Bloomberg) -- Tullow Oil Plc said Kosmos Energy LLC will remain involved in Ghana’s Jubilee oilfield project until at least the first crude is produced later this year.

The planned sale of Kosmos’s Ghanaian assets, including a stake in the offshore Jubilee field, to Exxon Mobil Corp. has “stalled,” Tullow’s Vice President for Africa Tim O’Hanlon said today in an interview in Paris. The failure to complete the sale hasn’t delayed the development of Jubilee, he said. Kosmos Chief Financial Officer Greg Dunlevy declined to comment.

The sale of Kosmos’s assets to Exxon Mobil was thrown into doubt last year after Ghana’s state-run energy company said it had a prior agreement to buy the fields. Dallas-based Kosmos, which is backed by Blackstone Group LP and Warburg Pincus LLC, had said that the $4 billion deal to sell its 23 percent stake in Jubilee to Exxon Mobil was exclusive.

“Kosmos have a declared business plan, they are excellent oil finders and that is their technical niche in the oil business,” O’Hanlon said. “They are owned by venture capital funds that have a shorter-term exit strategy, normally before expenditure for development occurs. They have a right to choose and certainly to change their business plan and they may well be doing that.”

Ghana will become an oil exporter this year when Jubilee starts production. The field has potential resources of 1.8 billion barrels, according to Tullow, its operator. O’Hanlon said plateau output of 120,000 barrels a day will be reached within six months.

Within Weeks

Separately, the addition of China National Offshore Oil Corp. and Total SA as Tullow’s partners in Uganda will be approved “within weeks,” O’Hanlon said. Tullow agreed earlier this year to acquire stakes in two Ugandan blocks from Heritage Oil Plc for as much as $1.5 billion, after derailing a rival bid from Italy’s Eni SpA.

Each company will take a one-third stake in Tullow’s venture and the plan to acquire the stakes from Heritage is “being approved simultaneously,” he said. Ugandan oil output may exceed 200,000 barrels a day beyond 2014 after starting next year, Tullow’s Chief Operating Officer Paul McDade has said.