Tullow to buy Australian oil firm

Oil companies are joining forces to help secure future supplies

Oil and gas exploration firm Tullow Oil has agreed to buy rival and partner Hardman Resources for 1.47 billion Australian dollars (£578m; $1.1bn).

Tullow, an Irish firm that is listed on the London Stock Exchange, will pay A$2.02 for each Hardman share, 54% more than the closing price on 22 September.

The move is backed by Hardman's board and shareholders also have the choice of taking shares in the new company.

Analysts said the move would let Tullow expand its business at a fair price.

"This probably is a reasonable price," said John Young, an analyst at Australian investment firm Wilson HTM.

Tullow and Hardman have worked as partners in Uganda, discovering two oil fields, as well as sharing stakes in ventures in Tanzania and French Guiana.

Tullow has operations in the UK, South Asia and Africa.