Tullow Oil FY group working interest oil production averages 59,200 barrels per day

Exploration firm Tullow Oil said on Wednesday that group working interest oil production averaged 59,200 barrels of oil equivalent per day, in line with guidance, with notable production growth from its Jubilee field in Ghana and the Simba field in Gabon offsetting lower than expected production from its TEN and Espoir assets.

Tullow Oil stated full-year oil production at Jubilee hit 74,900 bopd, ahead of guidance set at the start of the year, while the TEN field recorded an average of 32,800 bopd, below guidance at the start of the trading year.

In Ghana, the London-listed firm said ongoing improvements in operating performance had resulted in uptime of over 97% on both operated FPSOs and an increase in water injection rates and gas processing capacity as drilling was restarted in April, with four new wells and a workover successfully completed, ahead of plan.

Full-year revenues were expected to be around $1.3bn, with a realised oil price of $63 per barrel, including hedge costs of approximately $150.0m, while underlying operating cash flow was projected to be about $700.0m and free cash flow was forecast to be in the region of $250.0m, ahead of guidance, driven by continued focus on costs, supportive oil prices in the latter parts of 2021 and favourable working capital movements.

Looking ahead to 2022, group working interest oil production guidance was set at 55,000-61,0000 boepd, based on Tullow's existing equity interests in TEN and Jubilee.

Chief executive Rahul Dhir said: "2021 was a year of positive change and transformation for Tullow, and we ended the year on a firm financial and operational footing.

"In 2022, we will build on these firm foundations and focus on investing in our producing assets in West Africa. Our plans in Ghana, where we are in the process of increasing our stakes in both the Jubilee and TEN fields, will position us to deliver the free cash flow to reduce gearing to less than 1.5x by 2025. Elsewhere, our Gabon near-field non-operated exploration opportunities, our revised Kenya development project and the Beebei-Potaro commitment well in Guyana also have the potential to be significant value drivers for Tullow."

As of 0910 GMT, Tullow shares were down 5.42% at 53.76p.