Page 9 - AfrOil Week 04 2023

AfrOil PERFORMANCE AfrOil

Tullow’s main upstream assets are in Ghana’s offshore zone (Photo: Tullow Oil)

Africa-focused Tullow Oil sees 2022

revenues rising 34% y/y to $1.7bn

REGIONAL AFRICA- and South America-focused oil and country’s tax assessments are “without merit,”
gas explorer Tullow Oil (UK/Ireland) said on and will continue to engage the government to
January 25 that it expects to record $1.7bn in resolve the disputes.
revenue in 2022, up 34% year on year, on the A company spokesperson told Reuters that
back of higher global oil prices. tax incentives in Ghana are running out.
Tullow, which is due to release full 2022 Commenting on the development, Tullow
results on March 8, said the projected revenue chief executive Raul Dhir said its strong opera-
came at an average post-hedging realised oil tional delivery, focus on costs and capital disci-
price of $87 per barrel, up from $75 in 2021, with pline, the increased equity in our key operated
a net debt of $1.9bn. fields in Ghana and higher oil prices drove
The London-listed company has also material, expectation-beating free cash flow
reported a free cash flow guidance of $267mn generation in 2022, accelerating the Group’s
based on the increased equity interest in Ghana deleveraging towards a net debt to EBITDAX
projects, including two wells drilled in the South ratio of 1.3 times by the year-end.
East area of the Jubilee Field. “In 2023, we expect Jubilee production to
Tullow also expects a free cash flow for this exceed 100 kbopd once the new wells drilled in
year post-hedging to be $200mn at an aver- the southeast of the field are brought on stream.
age oil price of $100 per barrel. The company’s Our capital investment this year, in particular
liquidity at year-end 2022 was $1.1bn, includ- in Ghana, is expected to support production
ing $600mn in free cash and $500mn available growth through to 2025 and material free cash
under the revolving credit facility. flow generation,” Dhir said.
Tullow also said it plans to invest $400mn Meanwhile, production from the Twene-
in 2023, up by $50mn from last year, with the boa-Enyenra-Ntomme (TEN) block offshore
largest part of this sum going to its oilfields in Ghana averaged 23,600 barrels per day (bpd) of
Ghana, and the rest on decommissioning at an oil, net 12,500 bpd to Tullow, with an efficiency
oil price of $80 per barrel. rate of 98% with overall production at the lower
Other operational expenses include $40mn end of guidance.
in Gabon, $20mn in Côte d’Ivoire, $10mn in Output from its non-operated portfolio was
Kenya and $30mn on exploration and appraisal 16,700 barrels of oil equivalent (boepd) net last
activities. year. Capital expenditure totaled $43mn, with
Investment in Ghana this year is expected about 60% going to infrastructure.
to support production growth through to 2025 Tullow also indicated that it signed a letter of
and a free cash flow generation of $700mn to intent with the Ghana Forestry Commission in
$800mn for the two years of 2024 and 2025 peri- December for a nature-based carbon offset pro-
ods at an oil price of $80 per barrel. ject. A final investment decision for the project
Meanwhile, as taxes in Ghana are expected to with the Forestry Commission is expected this
be in excess of $300mn this year, Tullow said the year. ™

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