Tullow Oil plc has said that, Ghana operational performance has been strong in the first half with uptime on both Floating Production and Storage and offloading vessels (FPSOs) in excess of 95 per cent.
In a statement sited by the Vaultz News on the trading statement and operational update of the company, it said that an averaged 77,700 barrels of oil per day (bopd) were produced in the first half of 2020 in line with expectations and a full year guidance has been narrowed to 71,000-78,000 bopd reflecting continued good performance across the portfolio.
According to the statement,
“The first half of 2020, gross Jubilee production averaged 84,700 bopd (net: 30,000 bopd), gross TEN production averaged 50,900 bopd (net: 24,000 bopd) and net production from the non-operated portfolio was 23,700 bopd.”
The statement said completion operations on the Ntomme-9 production well at TEN are ongoing and the well is due onstream in August.
The Chief Executive Officer of Tullow Oil Plc, Rahul Dhir commenting on the update said that Tullow has performed well despite challenges.
“Since becoming CEO on 1st July, I have been impressed by the quality of Tullow’s people and the potential of our assets and I am confident that we can build Tullow into a competitive and successful business once again. Despite the challenging external environment in the first half of the year, Tullow has performed well; delivering production in line with forecast, agreeing the sale of the Ugandan assets and re-shaping the Group’s structure and cost base. In the second half of 2020 our focus will remain on continuing to deliver safe and reliable production from West Africa, reducing debt and building a cost effective and efficient organisation that can compete in a low oil price environment.”
The statement further noted that the impact of COVID-19 has been managed safely across their business with no impact on their operated production.
However, production of the Ghanaian oilfields is expected to fall to 31,600 bpd over the full year, from 54,000bpd in the first half.
Also, the revenue for the first half of 2020 is expected to be $0.7 billion with a realised oil price of $52/bbl, including hedge receipts of $131 million.
The statement further went on to outline its financial updates.
“At 30 June 2020, net debt is expected to be c.$3.0 billion and liquidity headroom and free cash are expected to be $0.5 billion; full year free cash flow is forecast to break even at the current forward curve.”
“Capital and decommissioning expenditure guidance for 2020 remains unchanged at $300 million (1H20: $192 million) and $65 million (1H20: $38 million) respectively.”
“As a result of lower near-term oil price forecasts, and a revision in the Group’s long-term oil price assumption from $65/bbl to $60/bbl, the Group expects material impairment and exploration write-offs to be recorded at the half-year in the range of $1.4-1.7 billion (pre-tax).”
“At 28 July, 60 per cent of 2020 sales revenue hedged with a floor of $57/bbl, 44 per cent of 2021 sales revenue hedged with a floor of $51/bbl.”
The statement issued was to summarize recent operational activities and to provide trading guidance in respect of the financial half year to 30 June 2020. The company said it is in advance of the Group’s Half Year Results, which are scheduled for release on Wednesday 9 September 2020.
