London-based Tullow Oil made  a $1.5 billion (£ 900 million) counterbid for the Ugandan oil fields that Heritage Oil had agreed to sell to the Italian state oil company Eni, The Times reported on Monday.

On Sunday, Tullow exerted its preemption right on the oil blocks 1 and 3A in the Lake Albert region, because it owned, together with Heritage, a half share in the Ugandan oil fields under the terms of their joint exploration venture. Tullow’s chief executive Aidan Heavey said on a conference call on Monday that the company is seeking international partners and is planning to sell half of the oil blocks to one or two major companies with experience in building long pipelines and refineries that would help develop infrastructures, reported The Wall Street Journal.

In a statement on its website, the Italian company Eni said it would wait for the Ugandan government’s decision before terminating the deed of sale it had agreed with Heritage. Tullow’s preemption will be successful only if Uganda’s government accept it and if no other companies make a higher bid before 25 January.

Paul Mubiru, the acting permanent secretary of Uganda’s Ministry of Energy and Minerals, said in a telephone interview with the Dow Jones Newswires that the government is still waiting for an official communication from Tullow Oil and has not yet decided whether to approve the deal. Heavey will present a plan, including a shortlist of potential partners, to the Ugandan government soon and hopes for it to be approved by the first week of February, The Wall Street Journal reported.

Tullow’s move marks a shift in the typical strategy of exploration companies, which usually sell the found oil field to larger groups, such as Eni, reported Reuters. Now, the Italian company is too late to enter Tullow’s selection of a partner, unless Ugandan government insists they be admitted.

Tullow Oil exercised its preemptive rights and put in a counterbid for these Ugandan oil fields. Photo credit: www.tullow.com