Tullow North Sea oil deal

TULLOW OIL'S purchase of North Sea oil assets has been given the thumbs-up by its broker Davy Stockbrokers.

Davy's analyst Job Langbroek, following Tullow's announcement of its intention to increase its activity in the North Sea, said: "The ongoing build-up of a portfolio of North Sea prospects, targets and reserves is, we believe, a highly sensible route for Tullow given the emerging strategic and monetary value of North Sea gas in the coming decade."

Tullow intends to increase its British North Sea activity by taking an interest in two consortia currently operating in the sector.

"As a result, the company will participate in two more wells one later this year and a second in the first half of 2003. It will acquire a 20% stake in block 44/17b, which lies to the north of the Murdoch complex and will also have a 20% stake in five blocks in quadrants 47 and 48.

"The deals are believed to be at ground floor level, which means that Tullow will only pay its own costs, which probably reflects the fact that Tullow has an interest in existing infrastructure in the general area," said Mr Langbroek.

Tullow subsidiary Tullow Exploration Limited (TEL), has entered into two transactions, which the company says significantly enhances Tullow's acreage portfolio in the Southern North Sea Gas Basin.

Completion of the acquisitions is conditional upon the receipt of the necessary consents of the Secretary of State for Trade and Industry in Britain.