Tullow Oil secures $345m loan

Tullow Oil has received a $345m loan to cover April's scheduled amortisation and ensure the company has enough headroom throughout 2017 as it refinances its bank facilities.

The oil and gas group said that overall, its capital commitments have reduced substantially following the completion of the TEN Project. During the fourth quarter, it will be generating free cash flow from its producing assets and can start paying down its debt.

At the beginning of October, Tullow had free cash and unutilised debt capacity of $0.9bn with no near-term maturities, and overall net debt of around $4.7bn.

Chief financial officer Ian Springett said: "This successful redetermination and the new reserve based lend accordion commitments underline the support for Tullow from our relationship banks and the quality of our assets and their ability to generate significant liquidity. Over the past three months, Tullow has started production from TEN and confirmed insurance cover for the Jubilee floating production storage and offloading turret repair and business interruption.

“With capital expenditure now substantially reduced, we are generating free cash flow and starting to deleverage our balance sheet. This provides us with a solid platform to refinance our RBL and corporate facility during 2017, enhance our capital structure and enable future growth."