British oil explorer Tullow Oil has formally ended its remaining financial interests in Kenya’s Turkana oil project after agreeing to receive an additional $9 million (approximately KSh1.16 billion) from Auron Energy E&P Limited, an affiliate of Gulf Energy.
The agreement, announced on Friday, marks the final phase of Tullow’s withdrawal from Kenya’s oil sector. Under the deal, Tullow will surrender its rights to future royalty payments from Kenya’s oil production as well as its option to re-enter the South Lokichar oil project with a 30 percent stake.
In return, the company will receive the additional payment, which is expected to be completed by July 17, 2026.
The transaction further strengthens Auron Energy’s position in the South Lokichar project, which hosts Kenya’s commercially viable oil reserves, while bringing to an end Tullow’s remaining financial interests in the development.
Tullow Chief Executive Officer Ian Perks said the agreement would enable the company to receive cash sooner while simplifying its portfolio and improving its financial position.
“This agreement allows us to accelerate the receipt of cash while simplifying our portfolio as we continue to strengthen our balance sheet,” Perks said.
The latest deal follows Tullow’s sale of its Kenyan subsidiary, Tullow Kenya BV, to Auron Energy in 2025. Under that agreement, Auron Energy committed to acquiring the business for a minimum consideration of $120 million, with payments structured in three phases.
The first tranche of $40 million was paid upon completion of the transaction in September 2025, while the second $40 million was released in March 2026 after approval of the Field Development Plan. The final $40 million remains payable by June 30, 2033, subject to conditions outlined in the original agreement.
Before the latest transaction, Tullow retained rights to receive royalties of $0.50 per barrel from a significant portion of future oil production from the Turkana project. The company also held an option to reacquire a 30 percent stake in future development activities.
Those rights have now been permanently relinquished in exchange for the additional payment.
The agreement does not affect ownership of Kenya’s oil resources or the South Lokichar oil project. Instead, it transfers Tullow’s remaining financial interests to Auron Energy, giving the company greater control over the project’s future development.
Tullow discovered commercially viable oil in the South Lokichar Basin in Turkana County in 2012, placing Kenya at the centre of efforts to become an oil-producing nation.
Although commercial oil production has not yet commenced, the South Lokichar project remains Kenya’s flagship oil development initiative.
The latest agreement represents the final step in Tullow Oil’s exit from Kenya’s oil sector, with Auron Energy now assuming the interests previously retained by the British explorer in the South Lokichar project.
