Oil Rich, Equity Poor: How Debt Ate Tullow Shareholders

Tullow oct26

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Tullow Oil’s latest operating update was strong: production up, new Jubilee wells performing, FPSO uptime above 99% and free cash flow guidance of $170–250 million reiterated. Two days later, the shares lost half their value in a single trading session.

The trigger was an adverse ICC ruling on a $196.5 million Ghanaian tax assessment, but the real vulnerability was the balance sheet. With net debt of around $1.4 billion, layered secured notes, payment-in-kind interest and junior Glencore debt, shareholders sit beneath a stack of fixed claims that absorb little of the downside.