Tullow Oil plc has announced an outstanding performance of the operation of its oil wells in the first half of 2021, as it published an unaudited revenue amount of US$700 million.
Compared with the previous year which was characterized by struggling finances and operational hiccups as a result of the adverse impact of the pandemic, Tullow Oil indicates that the first half of the year has seen massive improvements.
According to the oil major, this revenue was associated with a realized oil price of US$58/bbl including hedge costs of US$50 million.
In its ‘Trading and Operational Update’ released today, July 14, 2021, the company’s financial stance has been stabilized owing to the comprehensive refinancing of its debt, by raising US$1.8 billion bonds as well as a revolving credit facility of US$500 million. The Group also sold its Equatorial Guinea assets and Dussafu assets as a result.
Rahul Dhir, Chief Executive Officer, Tullow Oil plc, commented today:
“I am pleased to report that Tullow has made excellent operational and financial progress in the first half of 2021. Our producing fields in West Africa are performing well and we have successfully started our drilling programme in Ghana.
“This strong operational performance, combined with continued capital discipline, improved market conditions and asset sales in Gabon and Equatorial Guinea, supported our transformational debt refinancing.
“Tullow now has a strong financial footing and we are making very good progress in delivering on our highly cash generative business plan and continuing to reduce our debt.”
Rahul Dhir, Chief Executive Officer, Tullow Oil plc
Also, it is worthy to note that, Group working interest production increased in the first half of 2021 averaged 61,200 bopd, in line with expectations. Following this, the full year 2021 guidance has been revised to 55,000-61,000 bopd (from 60,000-66,000 bopd). This revision reflects the sale of its assets as stated earlier.
Performance of Tullow Oil’s assets in Ghana and Kenya
Precisely, in Ghana, the Jubilee gross production was slightly ahead of expectations, averaging 70,600 bopd in the first half of 2021 (net 25,100 bopd). TEN gross production averaged 37,000 bopd (net 17,400 bopd). Combined FPSO uptime was in excess of 98 per cent.
Furthermore, improved gas offtake and increased water injection rates in Jubilee have been sustained, averaging between 110-130 mmscf/d and over 200 kbw/d, respectively.
Also, the company affirms that the 2021 first Jubilee producer (J-56) is now on-stream with encouraging initial flow rates. Accordingly, the well is adding 10kbopd to the Jubilee field rate, slightly ahead of pre-drill expectations.
More so, the rig is now completing a Jubilee water injector (J-55 WI) with tie-in expected in the third quarter of the year. The rig will then move on to drill a TEN gas injector and a second Jubilee producer, with tie-in expected in late 2021 and early 2022, respectively.
As a result of the new developments, average production from Jubilee is expected to increase in the second half of the year before growing further in 2022 as the drilling campaign continues.
With its Kenya project, Tullow underscores that it has gone through redesign which is providing better understanding of both the resource and the optimum development plan. It further mentions that the technical work for that is complete and the resource volumes are undergoing auditing.
Tullow Oil and its JV Partners indicate that a project update will be given in the second half of the year.
