Tullow Oil strikes multiple deals in sweeping capital overhaul
Tullow Oil announced on Friday a capital overhaul and a number of deals to increase its presence in West Africa. The heavily-indebted company is aiming to stabilize its operations and ensure longer-term growth.
It said that the company had signed a refinancing agreement with Glencore, and owners of two-thirds (or $1.3 billion) of its senior secured notes due in May 2026. This extended debt maturities to November 2028 by more than two years.
Tullow is fighting against a 'natural decline in production and delays with government payments. This has strained the cash flow of independent oil producers and forced them to reduce costs due to mounting debt.
Separately, the company agreed to purchase a floating production,'storage and offloading vessel that serves Ghana's TEN Oilfields, for $205 Million. CEO Ian Perks stated this deal would cut fixed costs and increase long-term cashflow.
The company has also reached an agreement with the Ghanaian Government for the extension and renewal of the West Cape Three Points Petroleum Agreement as well as the Deep Water Tano Petroleum Agreement.
RUNWAY FOR RESEARCH AND DEVELOPMENT
Perks stated in a press release that "by extending maturities, and optimising our cash interest profile, we've secured the financial runway for us to improve our performance, execute our plan, and secure additional value" for our stakeholders.
Early Friday trading saw the shares of the company fluctuate between gains and losses. The company's shares had risen about?23% after having fallen more than 70% since 2025.
Tullow expects to have a liquidity "headroom" of free cash and undrawn facility in excess of 200 million dollars following the refinancing.
The London-listed oil company said it expects to produce between 34,000 and 42, 000 barrels of oil equivalents per day in 2026, up from the 40,400 boepd that was reported for 2025. (Reporting from Sri Hari N S in Bengaluru and Ankita Boora; editing by Mrigank Dahniwala, Jan Harvey).
(source: Reuters)
