London-based oil explorer Tullow Oil launched a placing of 80.4 million shares on Wednesday, equivalent to 10 percent of its outstanding shares, to pay for development of assets in Uganda.
Based on Tuesday’s closing price of 1,216 pence, the sale would raise almost £1bn. Tullow said the money will be needed to meet higher capital expenses after it dropped a plan to sell half its Uganda assets.
Tullow planned to sell the interests in the fields in the Lake Albert basin, to attract a partner with the technical expertise needed to develop the complex project.
However, when Tullow’s partner Heritage Oil agreed to sell its interests to Italian company ENI, Tullow exercised a pre-emption right and now plans to buy and sell on these assets, if the government approves the deal.