Occidental in talks to sell Ghana stakes to Kosmos Energy
Occidental Petroleum Corp. is in talks to sell offshore oil assets in Ghana to Kosmos Energy Ltd., according to people familiar with the matter. Kosmos is already a partner in the Jubilee and TEN oil fields operated by Londonbased Tullow Oil Plc.
Several obstacles, including tax issues, remain in the path of securing a deal, said the people, who asked not to be identified because the information is not public. Deliberations are ongoing and no final decisions have been made, they said.
Houston-based Occidental didn’t respond to inquiries and Kosmos declined to comment.
“At the right price it would be a highly complementary and de-risked acquisition” for Kosmos, said Will Hares, global energy analyst for Bloomberg Intelligence. That’s in part due to “only 14 percent of original oil in place recovered at the assets and operating partner Tullow’s new strategy which focuses on squeezing long-term value.”
Occidental CEO Vicki Hollub previously said she was confident the company would raise about $700 million from asset sales to reach a near-term goal. While Hollub hasn’t specified which assets are being actively marketed, the Ghana stakes were earmarked for sale on the company’s books as of Dec. 31, according to a 10-K filing with the Securities and Exchange Commission.
Asset sales are a key part of Occidental’s strategy to pay back debt after long-term borrowing surged nearly five times to more than $48 billion following the 2019 purchase of Anadarko Petroleum Corp. Occidental has sold nearly $9.2 billion of assets since then, according to data compiled by Bloomberg. Occidental acquired the Ghana assets as part of the Anadarko takeover.
Occidental previously agreed to sell the Ghana stakes as part of a wider Africa deal with TotalEnergies SE, but the deal fell apart amid regulatory and tax issues.
Currently, Kosmos and Occidental each own 24 percent stakes in Jubilee and 17 percent interests in TEN.
Drilling bans advance in House committee
A House committee on Thursday advanced sweeping legislation to combat climate change, with plans to block oil drilling in most U.S. offshore waters, thwart potential mining in the western part of the country and invest billions of dollars in conservation.
The $31.7 billion measure, approved 24-13 by the House Natural Resources Committee, would also slap new fees on oil and mining companies while funding drought relief, conservation and other programs. It is now set to be folded into a broader multitrillion-dollar social reform and climate change bill taking shape in the House.
Over the course of two days of panel debate and votes on the measure, Republicans took turns lambasting it as a “delusional” package of Democratic “pet projects” and “green pork.”
Congressional leaders need unanimous support from Senate Democrats to pass the bill, but the oil leasing provisions could draw opposition from some of them, including Joe Manchin of West Virginia, who has highlighted past support for Arctic refuge oil development.
Some of the planned spending has drawn broader support. The bill’s proposed funding for environmental analysis and conservation would benefit existing government programs “that need to be funded, bolstered and prioritized in this fight against climate change,” said Athan Manuel, director of the Sierra Club’s Lands Protection Program.