Tullow Warns of Default Risk as It Slumps to Loss

Tullow Oil warned it risked defaulting on a debt facility if it does not resolve a potential liquidity shortfall, as the Africa-focused explorer slumped to a $1.4bn pre-tax loss for the first half of the year, the Financial Times reported. The London-listed company said on Wednesday that a “potential liquidity shortfall” threatened its ability to satisfy requirements at a “redetermination” next January of its reserves-based lending facility. The company said it was exploring “various refinancing alternatives” but the news, revealed in its half-year results, pushed its shares down a fifth in early trading in London. At the January redetermination of its RBL, Tullow must show sufficient funds for the following 18 months, a period that includes the falling due of $650m of debt in April 2022. Read more