Tullow Oil, which has had a string of exploration successes in Africa, said yesterday it had successfully concluded a share placing with new and existing institutional investors to raise £402million.
The placing is mainly to help to provide finance for the development of its Jubilee and Mahogany discoveries offshore Ghana, thought to contain 1.2-1.8billion barrels of oil.
London and Dublin-listed Tullow is to issue more than 66.9million new shares, representing up to 9.1% of its existing stock.
Tullow said it would use the proceeds to fund the phase one development of Jubilee, which is scheduled to produce its first oil in the second half of 2010.
Cash raised from the issue will also go towards funding “selective high-impact exploration and appraisal wells” in Ghana and to commercialise what Tullow regards as world-class assets.
Tullow had exploration success in Ghana and Uganda last year, making 17 discoveries with 22 wells in 2008.
Chief executive Aidan Heavey said: “Further potentially transformational wells will be drilled in 2009 in both locations.
“The Jubilee phase-one development is on track and the potential for additional phases has been confirmed.
“Tullow has significantly exceeded the commercial- development threshold in Uganda and now also regards the Lake Albert area there as a world-class basin.”
This year, Tullow is due to drill the Twenboa and Teak pros-pects offshore Ghana, which are similar types of play to Jubilee, and in Uganda it is due to drill on Ngassa, the largest prospect identified in the Lake Albert region so far.
The three prospects are estimated to contain more than 1.5million barrels of oil.
Tullow said that outstanding exploration success had led to reserve replacement of more than 500% last year.
The company added that it was upgrading its reserves and resources from 551million to about 800million barrels of oil equivalent at the end of 2008.
Tullow, although focused at present on fast-tracking its African projects, also has significant gas and condensate production in the southern North Sea.