GHANA – Oil exploration and production company, Tullow Oil, has set aside US$270 million to be spent on the Jubilee and TEN oil fields as capital expenditure for the year 2022.
This is out of a total US$350 million set aside as capital expenditure for Tullow Oil’s oil fields in Gabon, Kenya, and Ghana.
The company noted that the increased year-on-year spending in Ghana is primarily due to investment in infrastructure for the Jubilee North East and South East areas.
This will lead to meaningful growth in production as these undeveloped paths of Jubilee are brought on stream from 2023 onwards.
“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,” said Chief Executive Officer of Tullow Oil, Rahul Dhir
Tullow Oil expects revenue at end of 2021 to be US$1.3 billion at a realized oil price of US$63 per barrel.
The company’s unaudited financial statements records reduced net debt to US$2.1 billion in 2021 from the US$2.4 billion recorded for the end of the year 2020.
The company is prioritizing investment in high return opportunities in its producing assets, whilst ensuring the business remains self-funded.
It expects Jubilee production to average between 80 to 84 kbopd (net: 28 to 30 kbopd) after considering the impact of a planned maintenance shutdown of approximately two weeks.
The company also plans to drill three new wells at Jubilee fields in 2022. A water injector is due onstream in the first quarter, which will provide pressure support to existing producers. This will be followed by a producer and a second water injector.
Its work program is focused on delivering reliable in-year production through continued infill drilling as well as investment in projects that will access undeveloped resources and lead to meaningful production growth in subsequent years.
This investment will focus on new infrastructure to support the development of over 170 mmbbls gross estimated ultimate recovery (EUR) in previously undeveloped areas in the eastern parts of the field.
The company also expects TEN productions to average between 22 to 26 kbopd (net 11 to 12 kbopd), driven by a natural decline in the existing wells.
It intends to drill two strategic development wells in the Ntomme area and an additional well in the Enyenra area to maximize production and the fields’ value potential.
The company’s Joint Venture (JV) is also investing in the infrastructure required to allow these wells to be brought on stream from 2023.
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