Tullow Oil plc (Tullow), the independent oil and gas exploration and production Group, announces its half-yearly results for the six months ended 30 June 2012. Tullow had an excellent first half. The Group’s strong financial performance was mainly driven by increased production, sustained high commodity prices and the profit on the Uganda farm down. This was partially offset by increased exploration write-offs and increased costs. Industry-leading exploration and appraisal success continued, including the discovery of a fourth new oil basin in five years. A programme of acid stimulations is increasing production on the Jubilee field, offshore Ghana, and together with Phase 1A development, is expected to deliver plateau production next year. In Uganda, the completion of the farm-down has been followed by a ramp up in drilling activity and progression of the Development Plan.
Commenting, Aidan Heavey, Chief Executive, said:
“In the first half of 2012 we continued to build on the record results achieved in 2011. Our exploration-led growth strategy continues to yield an exceptional success ratio and Tullow has, with the discovery of oil onshore Kenya, opened up a fourth new basin within five years. Our balance sheet has been transformed by the Uganda farm-down and our financial strength will continue to improve through growing production, as Jubilee fulfils its potential. A strong pipeline of activity in the second half of 2012 promises another excellent year for the Group.”
West and North Africa
Tullow’s African production comes from Ghana, Equatorial Guinea, Gabon, Cote d’Ivoire, Congo (Brazzaville) and Mauritania. Whilst the main development and operating focus is on the Jubilee and TEN projects offshore Ghana, Tullow has significant ongoing development activities in the majority of its operational areas. The Group also has high-impact exploration acreage across this region in Mauritania, Senegal, Liberia, Sierra Leone, Cote d’Ivoire and Ghana.
Net production in the first half of 2012 from the East and West Espoir fields averaged 3,600 boepd as natural
field declines continue to be managed. A drilling campaign of at least eight infill wells across the fields is planned
to start in October 2012. This campaign will rejuvenate production and extend the life of the field.
Two exploration wells were drilled in Cote d’Ivoire in the first half of the year. The first well, Kosoru-1 in CI-105,
encountered thick sandstone reservoirs with good oil shows but log analysis indicated that they were water
bearing at this location and this licence will be relinquished in August 2012. The rig then moved to the Tullow
operated Block CI-103 to drill Paon-1X exploration prospect. The well successfully encountered 31 metres of net
oil pay in a relatively high net-to-gross interval. This is likely to lead to further drilling in the licence within the
next 12 months.