Acquisition/Issue of Equity

Tullow Oil PLC
31 July 2000


TULLOW OIL PLC:
PURCHASE OF MAJOR PACKAGE OF NORTH SEA PRODUCTION INTERESTS FROM BP AMOCO ARCO
FOR A MAXIMUM CONSIDERATION OF Stg £201M

PLACING AND OPEN OFFER TO RAISE APPROXIMATELY Stg £41.8 MILLION (NET OF
EXPENSES)

Tullow   Oil   plc  ('Tullow'),  the  independent  oil  and  gas  exploration,
development   and   production  company,  today  announced  that   conditional
agreements had been entered into for the acquisition of interests in a  number
of  producing  gas fields and related infrastructure assets  in  the  southern
sector of the North Sea, for a maximum consideration of Stg £201million  cash.
To  part fund the acquisition, Tullow also announced a Placing and Open  Offer
to  raise approximately Stg £41.8 million (net of expenses), and signed a loan
agreement to provide up to Stg £140 million in bridge financing.

The  purchase,  which  is subject to the approval of the  UK  Government,  the
European  Commission, licence partners and Tullow shareholders, is  of  ARCO's
share  in  several  producing  gas fields and  associated  gas  pipelines  and
processing facilities and is designed to meet an undertaking given by BP Amoco
to  secure  approval by the European Commission for BP's takeover of  Atlantic
Richfield Company (ARCO).

The highlights of the acquisition are:

*      Two  packages of North Sea production and exploration
       assets to be acquired from BP Amoco/ARCO for Stg £201
       million, as of 1 January 2000, subject to adjustments
       
*      Assets  to  be  acquired  include  interests  in   16
       producing  southern  North  Sea  gas  fields  in  the
       Thames/Hewett and Murdoch field complexes with proven
       and probable reserves estimated at 242.6 bcf as at  1
       January 2000 and various associated gas pipeline  and
       terminal assets
       
*      Purchase  also includes 9 undeveloped gas discoveries
       and numerous exploration prospects and leads
       
*      BP  to  support  Tullow in its  proposal  to  operate
       Thames  area  fields, subject to  UK  Government  and
       licence partners agreements
       
*      Provides Tullow with significant cash flow to support
       its    anticipated   exploration   and    development
       programmes both for these assets and worldwide
       
*      Transforms Tullow in size adding approximately 25,000
       barrels  of oil equivalent production per  day,  over
       five times Tullow's current production
       
*      Acquisition part funded by Placing and Open Offer  of
       77 million New Ordinary Shares at Stg 57.5p per share
       to   raise   Stg  £41.8  million  (net  of  expenses)
       underwritten in full by Investec Bank
       
*      Open  Offer to Qualifying Shareholders on basis of  1
       New  Ordinary Share for every 7 Ordinary Shares  held
       on the Record Date
       
*      Bridge loan financing of Stg £140 million provided by
       CIBC World Markets
       
*      Most  of  the principal assets being acquired subject
       to pre-emption rights
  
  
  Commenting  on the acquisition, Aidan Heavey, Managing Director  of  Tullow,
  said:   'We  are  delighted  with  this  acquisition,  which,  in  a  single
  transaction, meets all the targets identified in our recent major  strategic
  review.  It will transform Tullow, provide sufficient production revenue  to
  fund  all  our  foreseeable international exploration  projects  and  unlock
  significant upside potential offshore UK.'
  
  He  added:   'We  believe the asset packages to be acquired  will  not  only
  provide Tullow with cashflow to advance activities in an optimal manner  but
  also  provide  the  platform  for significant economic  upside  in  existing
  producing  fields  in  the  near term, and good longer  term  appraisal  and
  exploration  potential.   We are also delighted to welcome  to  Tullow  John
  Lander and Brian Williams who have been recruited to manage these assets  in
  a  new UK subsidiary.  I believe their experience and that of the ARCO staff
  we  also hope to recruit will be a major benefit in developing our North Sea
  business.'
  
  Steve  Marshall,  BP's  Regional President in  charge  of  its  UK  upstream
  (exploration  and production) assets said: 'We are pleased to  have  reached
  this  agreement  with Tullow.  It will mark the completion of  the  required
  North  Sea  assets sale.  The deal gives Tullow entry to UK offshore  waters
  where  they  will bring a new perspective, as other new entrants  have  done
  successfully  before  them.   This can only benefit  the  North  Sea  as  it
  matures  further.  We have a transition plan in place and will  provide  all
  necessary  assistance to Tullow and the co-venturers to ensure  a  safe  and
  smooth handover'.
  
  For Further Information:
  
  Aidan   Heavey,   Managing  Tullow Oil plc     020 7389 0300
  Director
  Graham Martin, Legal and    Tullow Oil plc     020 7389 0300
  Commercial Director
  Tom     Hickey,    Finance  Tullow Oil plc     020 7389 0300
  Director
                                                            
  Peter Binns, Mike Tate          Binns & Co     020 7786 9600
  Judith    Parry,     Simon         Millham     020 7256 5756
  Rothschild                  Communications
  Joe Murray                          Murray     00353 1 632 6400
                                 Consultants            
  Nigel Tose                        Investec     020 7597 5970
                                   Henderson
                                 Crosthwaite
  
Notes to editors are set out at the end of this announcement.

Tullow Oil Plc ('Tullow')

Proposed  Acquisition  by  Tullow Oil plc of a  portfolio  of  United  Kingdom
Continental  Shelf  Southern Gas Basin Interests from  BP  Amoco  ARCO  for  a
maximum consideration of Stg £201 million

Proposed  Placing of 77,000,000 New Ordinary Shares at Stg 57.5p  (Euro  0.93)
per  share  and Open Offer of 39,322,026 of those New Ordinary Shares  on  the
basis  of  1 New Ordinary Share for every 7 Existing Ordinary Shares to  raise
Stg £41.8 million (net of expenses) to part fund the Acquisition

Introduction

Tullow  today announces that the Group has entered into conditional agreements
with  ARCO  and Britoil to acquire a number of interests in licences  covering
areas  in  the  Southern Gas Basin of the UKCS together with a  share  in  the
ownership   of  their  related  infrastructure  assets.  Completion   of   the
Acquisition Agreements is conditional upon, inter alia, Shareholder approval.

Most  of  the  principal assets are subject to the exercise of pre-emption  or
equivalent rights by co-owners. Therefore, the Tullow Group will only be  able
to  acquire certain of the licence interests and related infrastructure assets
if  the  co-owners do not exercise those rights. The periods for such exercise
are  between thirty and sixty days. Completion may not take place before these
periods  elapse  unless co-owners expressly waive their rights.  However,  the
interest  in  Gawain field is not affected by pre-emption rights of  co-owners
and  so  will  be  available for purchase by the Tullow  Group  if  the  other
conditions of the Acquisition Agreements are waived or satisfied.

The  Acquisition  is  subject  to a number of conditions.  These  include  the
requisite approval of Tullow Exploration as purchaser by the UK government  in
its  capacity  as licensing authority for the Assets and the approval  by  the
European  Commission of Tullow Exploration as the purchaser in the context  of
the  divestment by BP Amoco/ARCO of the Assets as a necessary step  to  enable
them  to merge. The Directors have no reason to believe that the Tullow  Group
is  not able to satisfy the criteria on which they understand the decisions of
these  regulatory  authorities  will  be  made.  It  is  envisaged  that   the
satisfaction  of  all  of  the  conditions may  take  several  months.  Hence,
Completion of the Acquisition is expected to take place in the fourth  quarter
of this year.

The  consideration  for  the  Acquisition (the 'Consideration')  is  Stg  £201
million  of  which  Stg  £21  million  is deferred  as  described  below.  The
Consideration  will be reduced automatically by the exclusion  of  any  assets
from the Acquisition following any exercise of pre-emption or equitable rights
by co-owners.

The  Acquisition is being made by reference to an economic date of 1  January,
2000.  As  at  1  January, 2000, the Assets were estimated to  contain  proven
reserves (net to Tullow) of  192.1 bcf and proven plus probable reserves  (net
to Tullow) of  242.6 bcf.

As  Completion is not expected to take place until the fourth quarter  of  the
year,  pending  satisfaction or waiver of the conditions  to  Completion,  the
operating  cash  flows generated by the Assets in the period from  1  January,
2000 until Completion will reduce the cash payable on Completion significantly
below the base Consideration of Stg £201 million. The Directors estimate  that
if Completion takes place on 30 September, 2000, this reduction will be in the
order  of Stg £38  million. If the base Consideration is not reduced  to  this
extent the difference will be made up from the working capital credit facility
detailed  below.   The Directors therefore believe that the net  consideration
due   at  completion  will  be  approximately  Stg  £142  million  (being  the
consideration of Stg £201 million less the deferred element of Stg £21 million
less  the  operating cashflows since 1 January 2000 of approximately  Stg  £38
million).

The  Company has obtained facilities totalling Stg £140 million from CIBC.  To
the extent that the Consideration is reduced as a result of the valid exercise
of pre-emption rights, the facilities will be proportionately reduced.

In  order  to finance the remainder of the base Consideration, the Company  is
proposing to raise approximately Stg £41.8 million (net of expenses) through a
Placing  and Open Offer of  New Ordinary Shares at Stg 57.5p (Euro  0.93)  per
share.  Of these New Ordinary Shares, 37,677,974 will be conditionally  placed
firm with institutional and other investors and 39,322,026 New Ordinary Shares
will  be  placed,  subject  to  clawback  to  satisfy  valid  applications  by
Qualifying Shareholders under the Open Offer. The Open Offer is being made  to
Qualifying  Shareholders  on the basis of 1 New Ordinary  Share  for  every  7
Ordinary  Shares held on the Record Date. The Placing and Open Offer has  been
underwritten in full by Investec Bank.

In  view of the size of the Acquisition in relation to Tullow, the Acquisition
is  classified  as  a  reverse takeover under the  rules  of  the  UK  Listing
Authority  and the Irish Stock Exchange, and implementation of the Acquisition
requires  the  approval of Shareholders. The listing of the Existing  Ordinary
Shares   was suspended at 3pm on Thursday 27 July and will be restored on  the
day  following  the  publication  of the circular,  comprising  a  prospectus,
prepared in relation to the Proposals, such publication being expected to take
place by 2 August 2000.

The  Acquisition  is  conditional  on the  approval  of  Shareholders  of  the
Proposals.  Approval  of the Shareholder resolutions required  to  effect  the
Proposals  will be sought at the Extraordinary General Meeting of the  Company
to be held on  25 August 2000.

The Prospectus

It  is expected that a Prospectus, accompanied by an Application Form for  use
in connection with the Open Offer, setting out details of the Placing and Open
Offer  and  including a notice of the Extraordinary General  Meeting  will  be
posted to Shareholders on by 2 August 2000.


EXPECTED TIMETABLE OF PRINCIPAL EVENTS           2000
                                             
Record Date for the Open Offer                   close of
                                                 business  on   24
                                                 July
                                             
Latest   time   and   date   for   splitting     3pm   on   18
Application  Forms  (to  satisfy  bona  fide     August
market claims only)
                                             
Latest   time  and  date  for   receipt   of 
completed  Application Forms and payment  in     3pm   on   22
full under the Open Offer                        August
                                             
Latest  time and date for receipt  of  proxy     12 noon  on   23
form for the  EGM                                August
                                             
Extraordinary General Meeting                    12 noon  on  25
                                                 August
                                             
Admission  of  New Ordinary Shares  and  re-     8.00  am  on   29
admission of existing Ordinary Shares            August
                                             
Time and date of delivery into CREST of  New 
Ordinary Shares to be held in uncertificated     8.00  am  on   29
form                                             August
                                             
Definitive share certificates in respect  of by  5 September
New   Ordinary   Shares  to   be   held   in
certificated form to be despatched

Background to the Acquisition

During  the first six months of 2000, the Company undertook a major  strategic
review  which encompassed all elements of its existing asset portfolio.  As  a
result  of this review, the Directors confirmed the strategy of the  Group  to
become a fully integrated oil and gas exploration and production business with
a  continuing focus on active exploration and gas to power opportunities.  The
Directors believe that a significant gas production purchase could assist  the
realisation  of this strategy by enhancing the Group's operational experience,
funding and development options.

The  Assets  became  available  for purchase following  the  decision  of  the
Competition Directorate of the European Commission, announced on 29 September,
1999, granting approval of the combination of ARCO and BP Amoco. This approval
was  granted subject to certain disposal undertakings relating to ARCO and  BP
Amoco's gas and pipeline interests in the Southern North Sea. Tullow has  been
advised  by  BP Amoco that these undertakings will be met by the  disposal  by
ARCO  and  Britoil  of  the Assets. Pursuant to the Acquisition,  Tullow  will
purchase  interests in 16 producing southern North Sea gas fields and  various
associated  gas  pipeline and terminal assets. The Acquisition is  conditional
upon approval by the European Commission of the purchaser and the transaction.
Production from the Assets is derived mainly from the Hewett and Thames fields
and  the  Murdoch field. The purchase comprises interests in  a  total  of  18
licences,  including  one awarded but not yet issued, and encompasses  several
undeveloped gas discoveries and a number of exploration prospects and leads.

Information on the Assets

The  Assets can best be described in three parts: the Thames area package  and
the  Hewett  area package (which together comprise the Thames/Hewett  Package)
and the Murdoch Package. All references to the proven and probable reserves of
the   Assets,  as  detailed  below,  have  been  sourced  from  the  Petroleum
Consultant's report which will be contained in the prospectus.

The Thames/Hewett Package

The Thames/Hewett Package comprises ARCO's interests in thirteen licences, and
Britoil's interests in two licences. The package contains 14 producing fields,
six  discoveries and a number of exploration prospects and leads, concentrated
in UKCS Quadrants 48, 49, 50, 52, 53 and 54.

Thames Area

Operated interests are held in the Thames field complex (43.33 per cent.), the
Gawain  (50.00  per cent.), Orwell (50.00 per cent.) and Welland  (33.734  per
cent.)  fields, and the Thames pipeline system (43.33 per cent.) that  exports
the  gas  and  associated condensate to the onshore Bacton terminal  which  is
operated  by Phillips. ARCO also operates the onshore logistics base at  Great
Yarmouth, together with the onshore control room which also performs a  number
of functions for other ARCO operated fields not included in the sales package.

The  Thames field complex comprises the Thames field itself and the associated
fields  of Yare, Bure (including Bure West), Deben and Wensum. Additional  gas
is  produced  from  the  Welland field, through an  unmanned  platform  (first
production  in  1990),  and from two fields developed by sub-sea  completions,
Orwell (1993) and Gawain (1995). The Thames production complex comprises three
linked  platforms which are permanently manned. Tariff income for  the  Thames
production  complex owners is derived from the production  received  from  the
Orwell, Welland and Gawain fields. After some processing on the platform,  the
gas  and  associated condensate is exported through the TAGGS 24 inch pipeline
to the terminal at Bacton.

Net  remaining  proven and probable reserves in these producing  assets  at  1
January,  2000  are  estimated  to be 149.8 bcf.  In  addition  to  the  above
producing  assets, five gas discoveries have been made in this  area,  but  at
present there are no plans for their commercial development.

Tullow  will  seek to take over from ARCO the operatorship of ARCO's  operated
interests  within  the  Thames production complex. This  will  be  subject  to
separate  government  and  co-owner approval,  but  is  not  a  condition  for
Completion.

Hewett Area

The  Hewett  area  package consists of the Hewett field  and  five  associated
fields all to the north of the Hewett field together with related interests in
the  Hewett-Bacton pipelines and the Bacton terminal. These associated  fields
are  Little  Dotty, Deborah, Della, Dawn and Delilah. None of these  interests
are operated by the Sellers.

Interests  in  the Hewett field and the associated fields have  been  unitised
with  the co-owners of adjacent blocks and the ARCO unitised interest is 19.85
per cent. The unit is not subject to re-determination. The Hewett field itself
has  been in production since 1969. Additional production is currently derived
from  the  satellite  fields Della (1988), Dawn (1995), Little  Dotty  (1979),
Deborah (1978) and Delilah (1998). The production complex totals six platforms
and gas is transported through two 30 inch pipelines to the Bacton terminal.

Net remaining proven and probable reserves as at 1 January, 2000 are estimated
to  be  32.1  bcf. In addition to the above producing assets,  two  other  gas
discoveries have been made in this area, but at present there are no plans for
their commercial development.

Thames and Hewett

The  gas  produced from the Thames and Hewett areas is sold under a number  of
separate sales arrangements. The sales agreements for the Thames fields  (with
the  exception  of Deben) and Gawain fields are on a life of  field  basis  to
British  Gas  Trading  and  PowerGen respectively.  Gas  pricing  under  these
contracts  is  escalated  in  relation to certain contractual  indices.  Other
production  is currently sold through ARCO's own gas marketing arm  at  prices
which are more reflective of open market prices.

Production  from  the  Thames/Hewett Package  comes  predominantly  from  good
quality  Rotliegendes sandstones, the main producing reservoir in the southern
North  Sea  Gas Basin. Additional quantities of gas are produced locally  from
Zechstein Carbonates and the Triassic Bunter Sandstones.

ARCO  has  an  extensive  database over the area and information  on  numerous
wells.  An  ARCO  internal review of the exploration and appraisal  potential,
notably  in  the  Thames area, has identified a number of mainly  Rotliegendes
prospects  and leads, with the potential to add significantly to  the  current
gas reserves already in production within the Thames and Hewett areas.

Murdoch Area

The  Murdoch Package comprises interests in three licences held by ARCO.  They
are situated in UKCS Quadrants 43 and 44 and contain two producing fields, two
discoveries  and a number of exploration prospects and leads.  None  of  these
interests are operated by ARCO.

The  Murdoch field (34.00 per cent.) is the main producing asset. The  Boulton
field  (9.50  per cent.) produces back to the Murdoch platform from  a  single
well.  The fields are produced through the Caister Murdoch System (CMS)  which
is  jointly  owned  by the original founder fields, Caister and  Murdoch.  The
Murdoch  Package includes ARCO's 17 per cent. ownership interest in  the  CMS.
Gas from the Murdoch field is produced via the Murdoch platform. This platform
is  controlled from the Conoco (U.K.) Limited ('Conoco')/BP Amoco gas terminal
at Theddlethorpe and is not normally manned. The gas and associated condensate
are transported to Theddlethorpe through a 26 inch pipeline. The Murdoch field
came  on production in 1993 and the remaining net proven and probable reserves
as at 1 January, 2000 are estimated to be 50.4 bcf.

The  Boulton  field  lies to the west of Murdoch and commenced  production  in
1997.  The  field  is  currently producing from one  well  through  a  minimum
facilities  platform, and then by 10 inch pipeline to the  Murdoch  well  head
platform.  The  reserves from this field have recently been upgraded  and  net
proven  and probable reserves as at 1 January, 2000 are estimated to  be  10.3
bcf.

The  gas  from  both the Murdoch and Boulton fields is sold  under  long  term
contracts  to  the  Conoco Group and the TXU Group respectively.  Gas  pricing
under these contracts is escalated in relation to certain contractual indices.
In addition, as a joint owner of the CMS, ARCO receives tariff income from the
Boulton  field  and  two  other fields, Schooner and  Ketch,  which  are  both
operated by Shell U.K. Limited..

The gas from this area is produced from Carboniferous sandstone reservoirs  of
different  ages, and these reservoirs are generally more variable  in  quality
than those in the Rotliegendes province to the south. There are two additional
Carboniferous discoveries and several exploration prospects on the blocks.  In
addition,  surrounding blocks also contain a number of undeveloped discoveries
and  exploration prospects, and Conoco, the operator for CMS,  is  looking  at
ways  to  develop  satellite fields in the CMS area under  a  single  unitised
scheme.  The  Directors believe that this scheme could represent a significant
source of upside potential for the Murdoch area.

Summary

The  Acquisition will comprise a number of sizeable production interests  with
established   production  histories,  and  will  be  capable   of   generating
significant cash flow in the short to medium term. A production forecast  will
be contained in the Petroleum Consultant's report in the prospectus. There are
also  a  number  of undeveloped discoveries and exploration targets  with  the
potential to enhance or maintain production in the areas for a number of years
to  come.  Although  certain  of the Assets are affected  by  pre-emption  and
similar  rights,  one  of  the principal Assets, the interest  in  Gawain,  is
certain  to  be  available  for purchase by Tullow  if  the  other  terms  and
conditions  of  the  Acquisition Agreements are  satisfied  or  waived  by  15
December, 2000. The Directors believe that this field, which as at 1  January,
2000  was estimated to contain proven and probable reserves of 66.6 bcf  is  a
very  important  asset with stable cash flows and has significant  exploration
upside.

Financial information on the Assets

As  at 31 March 2000, the net book value of the Assets to be acquired were Stg
£89.3  million.  The profit before taxation attributable to the Assets  to  be
acquired  for the year ended 31 December 1999 was Stg £37.3 million.   Further
financial information on the Assets will be included in the prospectus.

Integration and Management of the Assets

Tullow  is an established upstream operator, currently onshore in the  UK  and
both  onshore  and  offshore in other countries. In undertaking  the  proposed
Acquisition,  Tullow will become, for the first time, a holder of  acreage  in
the  UKCS. This will provide the Company with the opportunity to establish and
build a North Sea operation.

Tullow  recognises the quality of the existing staff and management,  and  has
reviewed  the control equipment, training and safety systems employed  at  the
operating  locations. If appointed operator, Tullow, as a new entrant  to  the
UKCS,  will  seek  to  maintain  the existing  operating  structure  in  Great
Yarmouth,  and will seek to retain the majority of the personnel who  work  on
the Thames area complex and in the Great Yarmouth base.

To  achieve a seamless and safe transfer of the operating role that  satisfies
all  parties involved, Tullow recognises the need for close co-operation  with
BP  Amoco, co-venturers and government organisations. The Directors anticipate
that  the  process of building a new North Sea operating entity will  take  at
least  six months from Completion. On the purchase of the Assets and  approval
of  its  operatorship role, Tullow proposes to apply to  join  UKOOA  and,  on
change  of  domicile  (as noted below), Brindex. Tullow  has  recruited  a  UK
Managing  Director and a UK Finance Director to oversee the  integration  into
the  Tullow group and the continuing management of the Assets. Information  on
these individuals is set out below.

John Lander (proposed managing director or Tullow Exploration)

John  Lander  (aged  56)  has  been involved  in  international  oil  and  gas
exploration  for  over  30 years. During this time he has  served  with  Shell
International  Petroleum, Ranger Oil, RTZ Oil and Gas and Elf UK,  principally
in  the  area  of  Exploration and New Ventures. From 1989 to  1995  John  was
Managing Director of Pict Petroleum Plc, which in 1996 merged with Premier Oil
Plc. Most recently John was Executive Director UK for British-Borneo Petroleum
Syndicate Plc and, from 1998 to 1999 was Managing Director of Tuskar Resources
Plc.  John  will be responsible for managing all Tullow North Sea  assets  and
operations. John is a qualified Geophysicist and in 1996 was President of  the
Petroleum Exploration Society of Great Britain.

Brian Williams (proposed Finance Director of Tullow Exploration)

Brian  Williams  (aged  45) MA, CA, qualified as a Chartered  Accountant  with
Thomson  McLintock in 1980. Since then he has worked for British National  Oil
Corporation,  Hamilton  Brothers  Oil and Gas  Ltd,  Pict  Petroleum  plc  and
Alliance Resources plc, in the latter two cases as Finance Director. Brian has
extensive experience of economic analysis, project finance, corporate  finance
and  investor  relations. Within Tullow, Brian will  be  responsible  for  all
accounting,  financial,  taxation and reporting  aspects  of  the  Group's  UK
operations.

The  Board  will not be changed as a result of the Acquisition and the  Assets
will be managed as a discrete entity within the Enlarged Group.

Acquisition Agreements

Under the Acquisition Agreements, Tullow will acquire a number of interests in
licences  covering areas in the Southern Gas Basin of the UKCS  together  with
their  related infrastructure assets. Details of the two packages of interests
proposed to be acquired is set out above and further details will be  set  out
in the prospectus.

With  the exception of the Gawain field interest, most of the principal assets
are  subject to pre-emption or similar rights held by co-owners so that Tullow
Exploration  will  only be able to acquire these interests  if  the  co-owners
decline  to exercise those rights. The period for such exercise varies between
thirty  and sixty days and Completion may not take place before these  periods
elapse  unless co-owners expressly waive their rights. The Assets are  in  the
main  held by co-owners who have held them for a significant period but  there
have  recently  been  some new entrants to the groups. Accordingly,  co-owners
will  have a variety of strategic objectives and the Directors are  not  in  a
position to predict whether pre-emption rights will be exercised.

The Acquisition is also subject to a number of other conditions. These include
the  requisite consent of the UK government as the licensing authority of  the
Assets and the approval of both Tullow as purchaser and the transaction by the
EC in the context of the divestment by BP Amoco/ARCO for the purposes of their
merger. The Directors have no reason to believe that the Tullow Group  is  not
able  to satisfy the criteria on which they understand the decisions of  these
regulatory authorities will be made.

As noted above, the transaction is subject to the approval of Shareholders and
to  the commencement of dealings in the New Ordinary Shares, which is expected
to take place on 29 August, 2000. It is envisaged that the satisfaction of all
of the conditions may take several months. As a result, Completion is expected
to take place in the fourth quarter of this year.

The  Consideration  is  Stg £201 million.  Of this  sum  Stg£66.6  million  is
attributable to the Murdoch Package, of which Stg£63.0 million is  payable  on
Completion and the balance is payable on the later of 29 March, 2002  and  the
date  which is twelve months after Completion. The remaining Consideration  of
Stg  £134.4 million is attributable to the Thames/Hewett Package, of which Stg
£117.0  million  is payable on Completion, Stg £10 million is payable  on  the
date  which is six months after Completion and the balance is payable  on  the
later of 29 March, 2002 and the date which is twelve months after Completion.

A  deposit  of  Stg  £1  million was paid on the signing  of  the  Acquisition
Agreements and a further deposit of Stg £4 million will be paid following  the
commencement of dealings in the New Ordinary Shares. The Consideration will be
automatically  reduced  by the exclusion of assets  from  the  Acquisition  in
consequence of the exercise of pre-emption or equivalent rights by the amounts
payable  by  the  pre-emptors,  which will  equate  to  the  portions  of  the
Consideration ascribed to the assets for the purpose of the Acquisition.

The  Acquisition is being made by reference to an economic date of 1  January,
2000.  The Consideration will be subject to a number of adjustments to reflect
the  fact  that actual ownership of the assets will not pass until Completion.
These  adjustments will take into account the working capital position of  the
assets  at 1 January, 2000 and the revenues, expenditures and related taxation
arising  from  that date until Completion. As Completion is  not  expected  to
occur  before  the  final  quarter, the revenues are expected  to  exceed  the
expenditures  by  some  margin  and  hence  the  actual  cash  amount  of  the
consideration payable for the assets will be significantly less than the  base
Consideration.

Further  details of the Acquisition Agreements and related documents  will  be
set out in the prospectus.

In  approving  the proposed Acquisition, Shareholders will be authorising  the
Company  to  proceed  to acquire all of the Assets, notwithstanding  the  fact
that,  due  to the valid exercise of pre-emption or similar rights beyond  the
control  of  Tullow, the ultimate packages acquired may be substantially  less
than  the  total.  Tullow is, however, satisfied that in the  context  of  the
transaction,  no pre-emptive right exists in respect of the interests  in  the
Gawain field and certain other assets.

In  the  event  that the Murdoch package becomes subject to  pre-emption,  the
Murdoch  Agreement allows Tullow to recover certain of its costs in evaluating
and pursuing the acquisition of interests in the Murdoch field.

Reasons for the Acquisition

The  addition  of  the  Assets  to  Tullow's  existing  UK  and  international
portfolios will mark a transformation of the Group and should provide it  with
significant  cash  flow  to  support  Tullow's  anticipated  exploration   and
development programme, both in the UK and overseas. The Directors believe that
the inclusion of the Assets within Tullow's portfolio will provide Tullow with
enhanced capabilities in its dealings in its target emerging markets.

The  Directors  believe  that  the  projected  returns  from  the  Assets  are
attractive  based  on  existing producing fields  alone.  The  Directors  also
believe that the undeveloped reserves associated with the Assets could present
significant upside potential.

The Acquisition will assist Tullow in its aim of becoming a more broadly based
oil  and  gas exploration and production business with a continuing  focus  on
active exploration and gas to power projects.

Principal Terms of the CIBC facility

In  order  to finance the Consideration, Tullow has entered into  a  Stg  £140
million  twelve  month  secured bridge facility with CIBC.  This  facility  is
available  to  fund the acquisition by Tullow of the Assets, to  fund  various
fees  and  expenses  associated with the Acquisition and  for  agreed  working
capital  requirements. Following Completion, it is intended  that  the  bridge
facility will be replaced by a 5 year borrowing base facility and CIBC  of  up
to  Stg  £125  million has committed to underwrite such a  facility  on  terms
acceptable  to Tullow. The availability under this facility will be determined
semi-annually  by reference to the expected future cash flows  of  the  assets
acquired.

The bridge facility is secured by a fixed charge over all the assets of Tullow
Exploration including the Assets being acquired, and a guarantee from Tullow.

Principal Terms of the Issue

The Placing

The  Company  proposes to issue 77,000,000 New Ordinary Shares  by  way  of  a
Placing  of which  39,322,026 New Ordinary Shares are the subject of  an  Open
Offer.  Investec  Bank  has  conditionally  agreed  to  procure  placees   for
37,677,974 New Ordinary Shares, which will be placed firm. Investec  Bank  has
also conditionally agreed to procure placees for the remaining 39,322,026  New
Ordinary  Shares subject to recall to satisfy valid applications by Qualifying
Shareholders under the Open Offer.

The Open Offer

In  order  to provide Qualifying Shareholders with the opportunity to  acquire
New  Ordinary Shares at the Issue Price, your Directors have arranged an  Open
Offer,  pursuant to which Investec Henderson Crosthwaite invites  applications
for New Ordinary Shares at Stg 57.5p (Euro 0.93) per share on the basis of:

1 New Ordinary Shares for every 7 existing Ordinary Shares

and  so  in  proportion for any other number of Ordinary Shares  held  on  the
Record  Date. Entitlements to New Ordinary Shares will be rounded down to  the
nearest  whole number and fractions of New Ordinary Shares will be  aggregated
and sold for the benefit of the Company under the Placing.

Application  Forms  are personal to shareholders and may  not  be  transferred
except to satisfy bona fide market claims.

The  New Ordinary Shares will, when issued and fully paid, rank pari passu  in
all respects with the existing Ordinary Shares, including the right to receive
all dividends and other distributions hereafter declared.

The  Placing  and  Open  Offer is conditional, inter  alia,  upon  Shareholder
approval  at the EGM, and Admission. It is expected that Admission  will  take
place  and  dealings in the New Ordinary Shares will commence on 29  August  ,
2000.

Use of the proceeds of the Placing and Open Offer and the CIBC facility

The  net proceeds of the Issue of approximately Stg £41.8 million (which  will
initially be placed on deposit) will be applied to pay the Consideration.

To  the  extent  that  co-owners exercise or fail to waive  their  pre-emption
rights and Tullow is unable to acquire certain assets and the Consideration is
therefore reduced, the facility from CIBC will be reduced in a similar fashion
such that the use of the proceeds of the Issue will not be materially altered.
In  the  event  (which the Directors consider unlikely) that the Consideration
for  the Assets falls below Stg £41.8 million, the surplus net proceeds of the
Issue  will  be  used  to fund the Company in continuing its  exploration  and
development  activities and in particular, completing the development  of  the
Cote d'Ivoire project without recourse to project finance.

Current trading and prospects

On  6 April, 2000 Tullow released its preliminary statement of results for the
year ended 31 December, 1999. This statement indicated an increase in turnover
of  approximately  32  per cent., principally due to the  Company's  increased
stake  in  the Ryedale Gas Field, and a return to operating profitability.  In
addition,  Tullow announced that gas sales from the Sara and Suri fields  were
continuing at approximately 38 mmscfd, that all sales targets had been met and
all payments received on time.

At  the  Company's  Annual  General Meeting on  22  June  2000,  the  Chairman
confirmed that favourable production and resource pricing conditions continued
to  prevail  and that, as a result of this, a significant advance in  turnover
and  operating profitability could be expected for 2000. Since the date of the
Annual  General Meeting the Group has continued to trade and operate  in  line
with the expectations of the Board.

Since  31  December, 1999, the Assets have continued to produce in  line  with
budget.  Cash  flow  in  relation to the production  of  uncontracted  gas  is
benefiting from increasing spot prices.

The  Directors  believe that the prospects for the Enlarged  Group  are  good,
particularly in the light of current favourable oil and gas prices.

Definitions

The  following  definitions  apply throughout  this  announcement  unless  the
context otherwise requires:

'Admission'        the admission of the New Ordinary Shares to
                   be issued pursuant to the Placing and Open
                   Offer to the Official Lists and to the Main
                   Market which is expected to become
                   effective on 29 August 2000
                   
'Acquisition'      the proposed acquisition of the Assets by
                   Tullow from the Sellers
                   
'Acquisition       the agreements dated 28 July 2000 between
Agreements'        the Sellers and Tullow Exploration relating
                   to the Acquisition
                   
'Act'              the Companies Act 1990 of Ireland (as
                   amended)
                   
'Application Form' the Application Form relating to the Open
                   Offer sent to Qualifying Shareholders with
                   the prospectus
                   
'ARCO'             ARCO British Limited
                   
'Assets'           the interests in licences currently held by
                   the Sellers covering areas in the Southern
                   Basin of the UKCS, in particular the
                   Thames, Hewett and Murdoch areas, and
                   including part ownership of related
                   infrastructure assets
                   
'Board' or         the directors of Tullow
'Directors'
                   
'BP Amoco'         BP Amoco plc
                   
'Brindex'          British    Independent   Exploration,    an
                   industry  group  comprising independent  UK
                   domiciled exploration companies
                   
'Britoil'          Britoil Public Limited Company
                   
'CIBC'             CIBC World Markets plc
                   
'Completion'       completion of the Acquisition
                   
'Consideration'    the consideration for the Acquisition
                   
'CREST'            the   computerised  settlement  system   to
                   facilitate the transfer of title to  shares
                   in uncertificated form operated by CRESTCo
                   
'CRESTCo'          CRESTCo Limited
                   
'EC' or 'European  Commission of the European Communities
Commission'
                   
'Enlarged Group'   the  Tullow  Group following completion  of
                   the Acquisition
                   
'Existing Ordinary the  275,254,187 ordinary  shares  of  Euro
Shares'            0.13  each  in the capital of  the  Company
                   currently in issue
                   
'Extraordinary     the  Extraordinary General Meeting  of  the
General Meeting'   Company to be held at 12 noon on 25  August
or 'EGM'           2000,  notice of which will be  set out  at
                   the end of the prospectus
                   
'Investec Bank'    Investec Bank (UK) Limited
                   
'Investec          Investec  Henderson Crosthwaite, a division
Henderson          of Investec Bank
Crosthwaite'
                   
'Ireland'          the Republic of Ireland
                   
'Irish Stock       the Irish Stock Exchange Limited
Exchange'
                   
'Issue'            the Placing and Open Offer
                   
'Issue Price'      Stg  57.5p (Euro 0.93, IR  73.24p,) per New
                   Ordinary Share
                   
'Listing Rules'    the   listing  rules  of  the  Irish  Stock
                   Exchange and the UK Listing Authority
                   
'London Stock      the London Stock Exchange plc
Exchange'
                   
'Main Market'      the  London  Stock  Exchange's  market  for
                   listed securities
                   
'New Ordinary      the 77,000,000 New Ordinary Shares proposed
Shares'            to be issued pursuant to the Issue
                   
'Official Lists'   the   Official  List  of  the  Irish  Stock
                   Exchange  and  Official  List  of  the   UK
                   Listing Authority
                   
'Open Offer'       the offer to Qualifying Shareholders of the
                   Open  Offer Shares at the Issue Price  upon
                   the  terms and conditions to be set out  in
                   the Prospectus
                   
'Open Offer        the  39,322,026 New Ordinary  Shares  which
Shares'            are    to    be   offered   to   Qualifying
                   Shareholders under the Open Offer
                   
'Operator'         the  entity appointed to operate a  licence
                   interest  or  an  infrastructure  asset  on
                   behalf of the co-owners of such interest or
                   asset
                   
'Ordinary Shares'  the  ordinary shares of Euro 0.13  each  in
                   the capital of the Company
                   
'Overseas          Shareholders  not resident  in  the  UK  or
Shareholders'      Ireland
                   
'Phillips'         Phillips  Petroleum Company United  Kingdom
                   Limited
                   
'Placing'          the   conditional   placing   by   Investec
                   Henderson  Crosthwaite of the New  Ordinary
                   Shares  subject, in the case of  39,322,026
                   of  the  New Ordinary Shares, to recall  to
                   satisfy  valid applications under the  Open
                   Offer
                   
'Placing and Open  the  conditional agreement  dated  28  July
Offer Agreement'   2000  between the Company (1) and  Investec
                   Bank  (2) relating to the Placing and  Open
                   Offer  details of which will be set out  in
                   the Prospectus
                   
'Proposals'        the  Acquisition and the Placing  and  Open
                   Offer
                   
'Qualifying        a holder of Ordinary Shares on the register
Shareholder'       at the close of business on the Record Date
                   other than certain Overseas Shareholders
                   
'Record Date'      the close of business of  24 July 2000
                   
'Registrar'        Computershare Services (Ireland) Limited
                   
'Regulations'      the   Companies  Act  1990  (Uncertificated
                   Securities) Regulations 1996 of Ireland
                   
'Resolutions'      the resolutions to be set out in the notice
                   of EGM
                   
'Securities Act'   the  United States Securities Act of  1933,
                   as  amended,  and the rules and regulations
                   promulgated thereunder
                   
'Sellers'          ARCO  and Britoil, both of which are wholly
                   owned subsidiaries of BP Amoco
                   
'Shareholders'     holders of Ordinary Shares
                   
'Stock Exchanges'  together the Irish Stock Exchange  and  the
                   London Stock Exchange
                   
'Subsidiaries'     Tullow's  subsidiary undertakings  for  the
                   time being
                   
'Tullow' or        Tullow Oil plc
'Company'
                   
'Tullow            Tullow Exploration Limited, a subsidiary of
Exploration'       Tullow
                   
'Tullow Group' or  the Company and its subsidiaries
'Group'
                   
'UK Listing        the Financial Services Authority acting  in
Authority' or      its capacity as the competent authority for
'UKLA'             the  purposes  of Part IV of the  Financial
                   Services Act 1986
                   
'United Kingdom'   the  United  Kingdom of Great  Britain  and
or 'UK'            Northern Ireland
                   
'UKOOA'            the   United  Kingdom  Offshore   Operating
                   Authority
                   

In this announcement, all references to 'IR£', 'Irish Pounds' and 'IRp' are to
the  lawful  currency of Ireland; all references to 'Stg', 'Stg£', 'Stgp'  and
'Sterling' are to the lawful currency of the United Kingdom; all references to
'US$'  and '$' are to the lawful currency of the United States of America  and
all  references  to 'US' and 'USA' are to the United States of  America;   all
references  to  'Euro' are to the lawful currency of the participating  member
states of the European Union.

Unless  otherwise stated, in this announcement the exchange rate of Euro  1  :
Stg  £0.617  prevailing on 28 July 2000 have been used. The  Irish  pound  was
irrevocably fixed from 1 January 1999 at Euro 1 :IR £0.787564

GLOSSARY

'bcf'              billion cubic feet
                   
'CMS'              the   Caister-Murdoch  System,   comprising
                   offshore   gas  gathering  and  compression
                   facilities    and    the    pipeline     to
                   Theddlethorpe
                   
'Probable          those  reserves of petroleum which are  not
reserves'          yet  proven  but  which  on  the  available
                   evidence  and taking into account technical
                   and economic factors have a better than  50
                   per cent. chance of being produced
                   
'Proven reserves'  those  reserves of petroleum which  on  the
                   available  evidence  taking  into   account
                   technical  and  economic  factors  have   a
                   better  than 90 per cent. chance  of  being
                   produced
                   
'UKCS'             United Kingdom continental shelf
                   

  
  
  Notes to Editors:
  
  1. Tullow Oil plc is an Irish registered public quoted company engaged in
     oil and gas exploration, development and production.  Tullow's assets
     cover more than 30 licences in its countries of operation which are
     Pakistan, India, Bangladesh, Cote d'Ivoire, Egypt, the United Kingdom and
     Romania.
     
     The  Company's shares are listed on the Official Lists of the London  and
     Irish  Stock Exchanges.  Tullow plans to re-register as a UK  company  in
     October 2000 but will retain its Irish Stock Exchange listing.
     
     In the UK, Tullow operates in three areas: North Yorkshire, operating and
     supplying gas to a power station; Lincolnshire, where oil is produced and
     sold  to  a local refinery; and South Yorkshire, operating the facilities
     for a gas storage project.
     
     At  the  end  of  1999, Tullow's reserves were 33.4  million  barrels  of
     liquids and 270 billion cubic feet of gas.
  
  2. The purchase from BP is of:

     * ARCO's equity in the Murdoch and Boulton gas fields and the Caister-
       Murdoch System pipeline: and

     * ARCO's equity in the Thames gas field with surrounding satellites, the
       Hewett gas field with surrounding satellites, the associated pipeline
       and terminal interests.

       ARCO's  equity  in  the  following gas fields will  transfer  to 
       Tullow:  Thames,  Hewett, Gawain, Yare, Bure including Bure West, 
       Deben,  Orwell, Welland, Boulton, Wensum, Della, Delilah, Murdoch,
       Little Dotty,  Deborah and  Dawn,  as  well  as  nine  undeveloped 
       satellite  fields  and  some exploration  acreage.  Also included in
       the sale is the interest  in  the Thames  field pipeline, the Hewett
       field pipeline and the Caister-Murdoch System  pipeline,  as  well as
       the interest in the Phillips-operated  gas processing terminal at 
       Bacton.
     
  3.   Tullow has also indicated a wish to take over from ARCO the
       operatorship of the Thames field and its associated satellites, subject
       to the agreements of Government and licence partners.  The Thames area
       assets operated by ARCO currently employ 22 staff based in Great
       Yarmouth and offshore, with a further 65 contractors' employees.  It
       will take some months to obtain all of the necessary approvals for the
       changes in ownership and operatorship.  No job losses are anticipated
       as a result of the sale.

  4.   Net  ARCO production from the fields in the purchase by Tullow amounts 
       to a  current average of some 150 million cubic feet of gas a day, with
       net proven  and  probable reserves at the end of 1999 of 242.6 billion 
       cubic feet.