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Tullow Oil plc (Tullow), the independent oil and gas exploration and production group, announces its half-yearly results for the six months ended 30 June 2013.

2013 Half-yearly Results Highlights

  • Financial results in line with market expectations. Production up 14% to 88,600 boepd, first half revenue up 15% to $1.3bn and operating cash flow before working capital movements exceeds $1bn for the first half.
  • Underlying profit also substantially increased after excluding the impact of the 1H 2012 Ugandan farm-down profit on disposal. Balance sheet remains strong with net debt of $1.7bn and $1.7bn headroom.
  • 13 exploration wells and 14 appraisal wells drilled to date in 2013 with a 63% overall success ratio.
  • Basin-opening E&A success continues onshore Kenya; following success at Etuko-1, Pmean resources are expected to be well in excess of 300 mmbo, exceeding the threshold for development studies to commence.
  • Six campaigns including 20 exploration wells planned for 2H 2013 targeting multiple basins in Kenya, Ethiopia, Mozambique, Mauritania and Tullow’s first operated well in Norway.
  • TEN Plan of Development (PoD) approved by the Government of Ghana; major contracts currently being awarded with First Oil expected in mid-2016. The farm-down process has been initiated for a development carry.
  • Group 2013 full year average production forecast revised to 84-88,000 boepd.
  • Successful outcome in court action versus Heritage Oil; $343m ordered to be paid to Tullow by 26 August 2013.

Financial overview

 1H 2013  1H 2012  Change
 Sales revenue ($m)  1,347  1,167  +15%
 Gross profit ($m)  764  679  +13%
 Administrative expenses ($m)  (89)  (95)  
 Profit on disposal ($m)  -  702  
 Exploration costs written off ($m)  (176)  (451)  
 Operating profit ($m)  500  834  -40%
 Profit before tax ($m)  486  829  -41%
Profit after tax ($m)  313  567  -45%
 Interim dividend per share (pence)  4.0  4.0  No change
 Operating cash flow before working capital ($m)  1,016  875  +16%
 Production (boepd, working interest basis)  88,600  77,400  +14%

Commenting today, Aidan Heavey, Chief Executive, said:

“Tullow continued to perform well in the first half of 2013. Our exploration-led growth strategy delivered major successes in Kenya and Ethiopia, further enhancing East Africa as a new oil region. We have six exciting exploration campaigns under way in the second half in 10 countries with 20 wells targeting multiple basins. Tullow also has a considerable pipeline of development activity. This includes reviewing potential development options for the over 300 million barrels of oil discovered onshore Kenya, the farm down of our interest in the TEN project in Ghana and reaching the final stages of agreeing the key components of the Lake Albert Basin development in Uganda. Our business has a very firm financial foundation with strong production and revenue growth and significant annual operating cash flow. I am very confident we are well placed for future growth and value creation.”

Presentation in London, Webcast and Conference Calls: Details are available in the Results Centre on the Group's website.