TULLOW OIL expects revenues for last year to have reached €800 million on the back of increased prices, the exploration and production group said yesterday.
The group began production from its Jubilee Field off the coast of Ghana in west Africa at the end of November, and it is on schedule to bring production from there to 120,000 barrels a day within six months.
Overall, Tullow’s average production this year will be between 86,000 barrels a day and 92,000 a-day.
In 2010 it was 58,100 barrels.
The group said in a trading statement yesterday that oil revenues for 2010 were $1.1 billion (€800 million) compared with $916 million the previous year.
The increase was largely due to higher oil prices during 2010. Tullow averaged $78 a barrel and sold at a discount to 2 per cent to the benchmark Brent crude price during the year.
Tullow expects to spend $1.5 billion on exploration and development this year, compared with $1.2 billion in 2010.
Last year, it bought Italian group Heritage Oil out of two blocks in the Lake Albert rift basin in Uganda for $1.454 billion, making it the sole owner of three blocks in the area, which has resources of over 2.5 billion barrels of oil.
It subsequently agreed to transfer a one-third interest each to Chinese giant CNOOC and French operator Total. However, a dispute over capital gains tax between Heritage and the Ugandan government has delayed progress.
The government has finally to approve both the purchase of Heritage’s interests and the deal between Tullow and its new partners. It will not do this until it has settled the dispute with Heritage.
Tullow said yesterday it was hopeful that it can be resolved quickly. In the meantime, it is working on a legally binding memorandum of understanding that will pave the way for the farm down and development of the Lake Albert rift basin assets.
Commenting yesterday, Tullow chief executive Aidan Heavey said that “the new partnership of Tullow, CNOOC and Total remains fully committed and looks forward to commencing the basin-wide development this year”.
