Tullow touts Ghana success as profits soar on oil prices

The UK based oil producer, Tullow Oil’s pre-tax profits soared 361% to $152 million in 2010.

Tullow said successful equity placing in 2010, coupled with the planned Uganda farm-down, and the increased cash flow from Ghana, will ensure that the Group remains well funded to execute its exploration-led strategy and continue to grow the business.

“With First Oil in Ghana and an excellent exploration and appraisal success rate, 2010 was undoubtedly a transformational year for Tullow. This contrasted with slower progress on our agreed farm-down in Uganda,” Aidan Heavey, Chief Executive Officer of Tullow said.

Tullow Oil saw a 19% rise in revenues to $1 billion in the year to 31 December.

It indicated in a press release issued Wednesday March 9, 2011 and copied to ghanabusinessnews.com that working interest production averaged 58,100 barrels of oil per day (bopd); with three year reserves replacement ratio of 250% at the Jubilee field in Ghana.

Tullow said its financial results went up on 2009 and will be transformed in 2011 by Jubilee production.
Balance sheet strengthened during the year through additional debt and equity totalling $2.35 billion, it said.

Tullow began commercial production of oil in Ghana on December 15, 2010.

“We are now a deepwater development operator having delivered production on schedule, within 5% of the original budget. The facilities uptime has been exceptional at over 90% and we will continue to ramp-up production over the next few months,” the release said.

Tullow said in the release that strong financial performance in 2010 revenue benefited from higher oil prices offset by slightly lower sales volumes.

“First Oil in Ghana was a major milestone for the Group and will transform Tullow‟s financial profile in 2011” Tullow said in the release.

According to Tullow, during the year it raised $1.45 billion from an equity placing and took the opportunity, based on good operational performance and a strengthening external environment, to increase its debt capacity. Finalisation of the Ugandan farm-down will secure significant funding for the medium-term and ensure it is well capitalised for an ambitious growth programme.

By Emmanuel K. Dogbevi

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