29th Nov 2018 09:08
LONDON (Alliance News) - Tullow Oil PLC on Thursday said it will reinstate its dividend after 18 months of "excellent operational and financial progress".
Shares in the oil & gas exploration company were trading up 0.9% at 181.45 pence each.
The dividend was suspended in early 2015 in response to a sharp fall in oil prices at the time. For 2014, Tullow paid an interim dividend of 4.0p per share but paid no the final dividend.
At the company's capital markets day, which will be hold later on Thursday, Chief Executive Officer Paul McDade will say: "Having reached our target of being a balanced self-funding exploration and production business and having embedded cost discipline across the group, this is the right time to reinstate a dividend and focus on our plans for growth."
The board will also establish a new capital returns policy in effect from 2019. Tullow expects the ordinary dividend "in any year" to be "no less than USD100.0 million" payable semi-annually.
"In periods of particularly strong free cash flow generation, the board will also look to supplement the ordinary dividend with additional returns to shareholders," the company added.
In addition, for 2018, Tullow said its board will review the chance for a "one-off" dividend after the end of the year.
In other developments, Tullow said it agreed with Discover Exploration Ltd to farm into Blocks 35, 36 and 37, offshore the Union of the Comoros in the Indian Ocean. The company will operate the three blocks with a 35% working interest.
The board also decided to cancel the undrawn USD350.0 million revolving corporate credit facility four months before maturity, "to realise cost savings from reduced commitment fees".
Related Shares:
Tullow Oil