Our long-term strategy is to find oil through exploration which we then seek to monetise through production or the sale of assets. We have demonstrated this both in Ghana through the development of the Jubilee and TEN fields and in Uganda with our farm-down to CNOOC and Total in 2012. Exploration success gives us options to monetise assets and maximise value at various points in the cycle. We selectively develop the oil we find, focusing on world-class development projects that are economically viable and will return sustainable future cash flows. As and when surplus cash is generated, a decision is made to either reinvest this cash into additional operational activities, pay down debt or return cash to shareholders.
Due to the significant fall in the oil price since mid-2014, we have reduced our expenditure on exploration substantially; limited our development spend to those projects which maintain or bring onstream substantial new production; focused on cost reduction; made sure our oil production is substantially hedged; strengthened our banking facilities; and suspended our dividend. Accordingly, although our long-term strategy for creating value for our shareholders remains unchanged, we have made significant changes to its implementation in the current environment.
As and when the sector recovers, and costs within oil services are reduced, Tullow will reconsider its exploration budget in the firm belief that the best oil to develop or sell is oil that we have found ourselves. Meanwhile, our much reduced exploration spend is currently focused on ensuring that Tullow has a balanced and exciting prospect inventory which is ready for any change in market conditions. We recognise that our strategy requires disciplined execution in the short term to deliver a successful, well-funded business for the future and we continue to stress-test both our balance sheet and business plan at very low oil prices to ensure that we can execute our strategy despite the current volatility in the oil and gas industry.