Tullow in $400 million debt deal, Ghana oil marketing pact with Glencore - Reuters
Tullow in $400 million debt deal, Ghana oil marketing pact with Glencore | Reuters
Tullow in $400 million debt deal, Ghana oil marketing pact with Glencore
The logo of Glencore is pictured in Baar, Switzerland, September 30, 2015. REUTERS/Arnd Wiegmann/File Photo Acquire Licensing Rights
Nov 13 (Reuters) - Tullow Oil (TLW.L) said on Monday it signed a $400 million five-year debt deal with Glencore (GLEN.L) to help manage its senior notes maturing through 2026 and will see the trading house take over marketing the crude from its flagship Ghana oilfields.
The facility, with Glencore Energy UK Ltd, will be available to draw for 18 months and allow Tullow to address all its outstanding 2025 notes and also refinance its 2026 notes, CEO Rahul Dhir said in a statement.
The facility "significantly de-risks" Tullow's ability to refinance its 2026 notes, Peel Hunt analysts wrote in a note.
"This uncertainty has been a key drag on the share price and we expect the shares to react well to today's announcement," the brokerage said.
Tullow's shares were up 3.6% at 31.5 pence in early trade. They have fallen more than 17% this year.
The company also signed an oil marketing and offtake contract with Glencore for Tullow's crude oil entitlements in Ghana and Gabon. Tullow had previously marketed the crude in-house.
The deal includes all output from its Jubilee and TEN fields offshore Ghana, a spokesperson said.
Tullow expects net volumes from its Ghana fields of around 46,000 barrels per day (bpd) this year in addition to around 10,000 bpd from Gabon.
Tullow reiterated its free cashflow guidance of $800 million between this year and 2025.
Reporting by Radhika Anilkumar in Bengaluru, additional reporting by Shadia Nasralla in London; editing by Savio D'Souza and Jason Neely
Our Standards: The Thomson Reuters Trust Principles.
Related Knowledge Center: Climate economics
Climate change is now a driver of the world’s economy. The impact is profound:
- Catastrophic weather events — hurricanes, floods, droughts, high temperatures — are more frequent and more extreme. The cost can be measured in both the initial damage caused and the longer-term impact on the economy.
- Vulnerable communities are increasing climate-related investments, hardening infrastructure and taking other protective measures.
- Investment in carbon capture and storage technologies is increasingly rapidly.
- Governments are making investments and crafting regulations to reduce emissions of carbon dioxide and other greenhouse gases.
On top of all of this is the cost of uncertainty. As the Fourth National Climate Assessment, released in 2018 by the U.S. Global Change Research Program, says, “The assumption that current and future climate conditions will resemble the recent past is no longer valid.”