Italian oil group ENI has said it is establishing operations in Uganda by paying $1.5 billion for resources in the Lake Albert bowl owned by Canadian company Heritage. Tullow is the current partner of Heritage at the sites.
ENI said it had agreed to buy Heritage's half ownership in two hydrocarbon production sites. ENI would pay $1.35 billion, and an additional $150m in cash or in the form of assets if certain conditions were satisfied.
The Italian group said that the two sites, called 1 and 3A, lay in one of the biggest sedimentary bowls in Africa, and contained over one billion barrels of oil equivalent. Resources equivalent to 700 million barrels had already been located with the drilling of 28 wells.
ENI said that its investment was part of a growth strategy to expand into Africa and in the sub-Saharan region in particular.
In February, Tullow said that Uganda, where oil was first discovered in 2006, could become one of the 50 biggest oil producers in the world.
Some experts hold that the reserves there could amount to about 2 billion barrels, with most of this lying beneath Lake Albert.
ENI has been active in sub-Saharan Africa since the beginning of the 1960s. The company has operations in Angola, Ghana, Gabon, Mozambique, Nigeria and Congo. It produces about 450,000 barrels of oil equivalent a day from the continent.
