Tullow Oil Proposes $750 Million Rights Issue

LONDON--Tullow Oil PLC (TLW.LN) Friday proposed a rights issue of 466.9 million new shares at 130 pence (158.6 cents) each to raise $750 million.

"Tullow has taken a number of significant steps since 2014 to re-set and restructure the business to ensure the Group is well positioned to meet the challenge of lower oil prices. As a result, we are now producing positive free cash flow and have begun the process of reducing our debt," Chief Operating Officer and Chief Executive Officer-designate Paul McDade said.

"Tullow has a strong set of low cost production, development and exploration assets in Africa and South America and, by accelerating the reduction of our gearing through this Rights Issue, we will be able to focus on growing our business by investing more across our portfolio and taking advantage of opportunities that industry conditions present," Mr. McDade said.

The oil and gas explorer said the issue price is a 45% discount to the closing price of 237.3 pence on Thursday.

Also Friday Tullow said CNOOC Uganda Ltd. (CNOOC) has notified Tullow that it has exercised its pre-emption rights under the joint operating agreements between Tullow, Total and CNOOC to acquire 50% of the interests being transferred to Total on the same terms and conditions that were agreed between Tullow and Total.

-Write to Razak Musah Baba at [e-mail]; Twitter: @Raztweet

(END) Dow Jones Newswires

March 17, 2017 03:40 ET (07:40 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.