Wednesday 28 June 2017

Shares in Tullow Oil jump as Goldman Sachs highlights potential takeover

Tullow boss Aidan Heavey. Photo: Mark Condren
Tullow boss Aidan Heavey. Photo: Mark Condren
Thomas Molloy

Thomas Molloy

Shares in Tullow jumped as much as 8.8pc in London today as Goldman Sachs highlighted the potential for a takeover or the sale of some assets.

Tullow advanced 8.8pc to £5.44 during afternoon trading, extending a 10pc gain posted over the Monday and Tuesday trading sessions.

The gains came as Goldman said in a report that mergers and acquisitions are set to drive the exploration sector.

The report highlighted both Tullow and Africa Oil as well as Dublin-listed Dragon Oil and Genel.

Large, established oil companies will abandon complex projects and turn instead to smaller exploration companies such as Tullow which already have proven oil fields, Goldman says in note published on Tuesday.

Analysts raised their rating for both Tullow and Africa Oil to “buy” from “neutral”.

Goldman said Tullow offers a diverse and full-cycle portfolio and predicted that cash flow will turn positive in 2017.

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