Tullow Oil rises sharply on takeover speculation

Shares of Irish-founded exploration firm Tullow Oil rose sharply in London yesterday as speculation swirled that Norway's Statoil could be interested in buying the company.

Tullow, founded and headed by chief executive Aidan Heavey, shot 7.4 per cent in London to £9.09, which gave it a market capitalisation of £8.2 billion.

Tullow, focused on exploration activity in Africa, has been a major success for Heavey, who got involved in the oil business after a  conversation with a golf partner.

As an accountant, he had been working with carrier Aer Lingus' subsidiary before starting Tullow, targeting the acquisition of small oil fields in west Africa.

Heavey owns 6.4 million shares in Tullow, currently worth more than €70 million.

The first half of 2013, saw Tullow generate a revenue of $1.3 billion as also a pre-tax profit of $313 million.

The company produced an equivalent of 88,600 barrels of oil a day in the first half of 2013.

Among its major assets, the company counts the Jubilee field in Ghana. It also has  successful producing fields in Kenya and Uganda.

The company has a total of 68 producing fields with operations across 25 countries, including a presence in Norway. The company incurred $2 billion in capital expenditure last year.

Meanwhile, the top share index of the UK closed firmer yesterday, though not the session's best, following disappointing US jobs data pushing the index back from its highest levels since early November.

The FTSE 100 was up at 2014 high at 6,769.94, just as a report on non-farm payrolls showed hiring by US employers was the lowest in almost three years in December.

The payrolls swelled by some 74,000 people last month, as against the 196,000 projected by economists in a Reuters survey this week. The lack of hiring was attributed in part to bad weather.

Reuters quoted Fawad Razaqzada, a strategist at GFT Markets as saying the disappointing data took the momentum out of an index that had looked to escape its recent 90-point range.