The share price of Tullow Oil significantly recovered yesterday after the company issued a statement reassuring the market that its current exploration and development programme is on target.

Tullow said incorrect reports circulating in London and Dublin may have encouraged some investors to sell their shares.

A statement said the recent share price movements were "unwarranted" and the company is "aware of no adverse or unusual event in the company's circumstances which should prompt such movements".

In Dublin the share price closed up 9p at 55p in heavy trading, while in London it rose by 15 per cent, up 6.5p to 48.5p sterling.

On Thursday more than 25 per cent of the company's share price was lost after rumours of a setback to its attempt to conclude a bid for the award of Blocks 9 and 11 in Bangladesh circulated in London and Dublin.

Mr Graham Martin, legal and commercial director of the company, confirmed yesterday that other reports concerning clients of MMI stockbrokers, which is currently suspended from trading, having shares in the company, may also have prompted some shareholders to sell.

He said some MMI clients did previously have a stake in the company, but he did not know whether they had any shares in the company now.

Worries about those shareholders retaining their shares in the company might have caused a worry, but he said it was "an unnecessary one".

"Some shareholders may have needed to find themselves some cash, but that has nothing to do with the strong fundamentals of this company," he said.

He said that Tullow is expecting a positive announcement from Bangladesh "very shortly". The company expects the authorities there to invite it to conclude a production sharing agreement for Blocks 9 and 11 as soon as the flooding crisis in the country is dealt with.

The block 9 licence is extremely important to the company as its covers an area surrounding the capital Dhaka and any discoveries would be cheap to develop.