Tullow Oil plc (“Tullow”) and its Joint Venture partners have received extensions to their exploration licences in Kenya up to the end of 2021.
The exploration licences is specifically for their Kenya operations in Blocks 10BB and 13T and follows the approval of the work programme and budget for next year by the Ministry of Mines and Petroleum.
This is according to a press release by Tullow Oil plc which intimates that at the Group’s recent ‘2020 Capital Markets Day’ held to discuss its new strategy and plan for the next 10 years, it was announced that the licence extensions will allow the Joint Venture partners to re‐assess Project Oil Kenya and design an economic project at low oil prices whilst preserving the phased development concept.
“In parallel, over the coming months, the Joint Venture partners will work closely with the Government of Kenya on land and water agreements, gaining approval of the Environmental and Social Impact Assessments and finalising the commercial framework for the project.
“The successful completion of this work will enable the submission of Field Development Plans to the Government of Kenya,” the statement said.
Rahul Dhir, Chief Executive Officer (CEO) of Tullow Oil Plc upon receiving the extension licence said he would like to “thank the Government of Kenya for granting this extension which the Joint Venture partners will use to fully re‐assess the development concept for this important project.”
Capital Markets Day
Tullow Oil plc held its ‘2020 Capital Markets Day’ virtually this year and the programme was hosted by a team made up of some of the organisations’ Board members and management.
The team members included Rahul Dhir, Chief Executive Officer (CEO); Les Wood, Chief Financial Officer (CFO); Wissam Al-Monthiry, Managing Director (MD), Ghana; and Julia Ross, Director, People & Sustainability.
During the event, the team presented Tullow’s new strategy and plan for the next decade which focuses on the substantial potential within the organisations’ large resource base associated with its producing assets where there is extensive infrastructure in place.
Tullow further asserts that this plan, alongside a rigorous focus on costs, is expected to generate material cash flow over the next decade, which the Group anticipates will enable reduction of its current debt levels and deliver significant value for its host nations and investors.
Commenting on the new plan the CEO enunciated that “since joining Tullow in July 2020 I have been deeply impressed by the strength of the Group’s assets, especially in Ghana. Following hard work by our team, and with input from our partners and external experts, we have a clear strategy and plan for the next 10 years.
“The plan focuses our capital on a deep portfolio of short-cycle, high-return opportunities within our current producing asset base and will ensure that Tullow can meet its financial obligations and deliver material value for our host nations and investors,” Rahul Dhir remarked.
At the meeting it was revealed that in Ghana, Tullow has produced just 400 million barrels of oil (gross) from 2.9 billion barrels of oil in place (c.14%) as such requiring more improvement in the coming years.
The new plan will deliver production growth in the medium term and the ability to sustain production over the longer term. Also, the first phase of investment will start in the second quarter of 2021 with the commencement of a multi-well drilling programme in Ghana.
Tullow is an independent oil and gas, exploration and production group, quoted on the London, Irish and Ghanaian stock exchanges (symbol: TLW). The Group has interests in over 70 exploration and production licences across 15 countries.
