Related documents

Following the release on 9 March 2022 of the Company’s full year results announcement for the year ended 31 December 2021 (the “Announcement”), the Company announces it has published its Annual Report and Accounts for this period (the “Annual Report and Accounts”).

A copy of the Annual Report and Accounts is available to view on the Company’s website: The Company is also pleased to announce it has published its Sustainability Report and Climate Risk and Resilience Report, which is also available on the Company’s website:

It is anticipated that the Company’s 2022 Annual General Meeting will take place on Wednesday 25 May 2022 and the Notice of Meeting will be sent out in due course.

In accordance with the Disclosure Guidance and Transparency Rule 6.3.5(2)(b) and the Central Bank of Ireland’s Transparency [Directive 2004/109/EC] Regulations, additional information is set out in the appendices to this announcement. The information is extracted in full unedited text from the Annual Report and Accounts.

The Announcement included a set of condensed financial statements and a fair review of the development and performance of the business and position of the Company and its group.

In accordance with Listing Rule 9.6.1, a copy of the Annual Report and Accounts have been submitted to the Financial Conduct Authority via the National Storage Mechanism and will be available for viewing shortly at

In addition, all of the above documents have been submitted to Euronext Dublin and the Ghana Stock Exchange, and therefore will shortly be available for inspection at Euronext Dublin (Exchange Buildings, Foster Place, Dublin 2) and will be available to shareholders located in Ghana by contacting the Company's registrar: Central Securities Depository (GH) Limited, 4th Floor, Cedi House, PMB CT 465 Cantonments, Accra, Ghana (Telephone: +233 (0)302 906 576).

For further information contact:

Tullow Oil plc Camarco
 (+44 20 3249 9000)
Robert Hellwig, Matthew Evans (Investors)
George Cazenove (Media)
(+44 20 3781 9244)
Billy Clegg
Monique Perks
Rebecca Waterworth

Notes to Editors

Tullow Oil plc

Tullow is an independent oil & gas, exploration and production group, quoted on the London, Irish and Ghanaian stock exchanges (symbol: TLW). The Group has interests in over 30 exploration and production licences across eight countries. In March 2021, Tullow committed to becoming Net Zero on its Scope 1 and 2 emissions by 2030. For further information, please refer to our website at

Follow Tullow on:



Appendix A: Directors’ responsibility statement

The following directors' responsibility statement is extracted from the Annual Report and Accounts (page 92).

Directors' responsibility statement required by Disclosure Guidance and Transparency Rule 4.1.12R and the Central Bank of Ireland’s Transparency [Directive 2004/109/EC] Regulations 2007

The Directors confirm, to the best of their knowledge:

  • that the consolidated Financial Statements, prepared in accordance with UK-adopted international accounting standards and IFRSs adopted pursuant to Regulation (EC) No. 1606/2002 as it applies in the European Union give a true and fair view of the assets, liabilities, financial position and profit of the Parent Company and undertakings included in the consolidation taken as a whole;
  • that the Annual Report, including the Strategic Report, includes a fair review of the development and performance of the business and the position of the Company and undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face; and
  • that they consider the Annual Report, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Company’s position, performance, business model and strategy.

By order of the Board

Rahul Dhir                                                              Les Wood
Chief Executive Officer                                       Chief Financial Officer
8 March 2022                                                        8 March 2022


Appendix B:  A description of the principal risks and uncertainties that the Company faces

The following description of the principal risks and uncertainties that the Company faces is extracted from the Annual Report and Accounts (pages 36 to 42).

Risk oversight and governance

A risk focused culture and consistent risk management framework is embedded across all levels at Tullow and is driven by the Board. The Board is responsible for overseeing the risk identification, assessment and mitigation process. To this end, the Board undertakes a bi-annual assessment of the risks facing the Company, including those risks that could threaten our business strategy, operating model, performance, solvency and liquidity. Emerging risks are discussed by the Board and the Senior Leadership Team periodically throughout the year.

The Board is responsible for ensuring Tullow maintains an effective risk management and internal control system and works closely with Tullow’s Senior Leadership Team to ensure this is in place. The Senior Leadership Team is collectively responsible and accountable for the risk management process in place across the organisation, with individual members taking ownership for risks that fall in their business area.

Tullow recognises that risk cannot be fully eliminated and that there are certain risks the Board and/or the Senior Leadership Team accept when pursuing strategic business opportunities. Acceptance of risk is made at an appropriate authority level and within Tullow’s defined risk appetite and tolerance levels.

Risks identification and assessment

Each Business Head and Head of function is responsible, and accountable, for managing risk and risk mitigation within their remit. The Extended Leadership Team (ELT) reviews and reassesses risk on at least a quarterly basis to evaluate the strength of existing controls and determine whether additional risk reduction actions are needed to ensure the risk level is within the risk appetite set by the Board.

Consolidation of business risks

To facilitate assessment of the main risks facing the business, Tullow’s leadership undertakes a bottom-up review of the key risks faced by the business. The key risks in each area are identified by the Business Heads and Heads of Functions, including mitigating actions and any emerging risks. These are consolidated upwards into the Business Unit risk registers and assessed according to their likelihood of occurring, and the potential consequences to Tullow in terms of safety, reputational, financial, legal and regulatory impact.

From this, the Senior Leadership Team identifies the principal and enterprise-wide risks which can be either a single risk, or a set of aggregated risks which, taken together, are significant for Tullow. Members of the Senior Leadership Team have ownership and accountability for stewardship of each of the principal and enterprise-wide risks. As a collective, the Senior Leadership Team reviews and discusses the risks to understand whether mitigations are being effectively executed within the agreed timeframe.

On a bi-annual basis the principal risks and mitigants are discussed by the Board to provide ‘top-down’ challenge and support. The result of this review is communicated back down to the Business Units to facilitate risk awareness and effective decision making throughout the organisation.

Risk appetite

The Board sets Tullow’s risk appetite and acceptable risk tolerance levels for each of the principal risk categories. In considering Tullow’s risk appetite, the Board reviews the risk identification process, the assessment of enterprise level risks, the existing controls and mitigating actions and the residual risks. During this process, the Board articulates which risks Tullow should not tolerate, which should be managed to an acceptable level and which should be accepted in order to deliver our business strategy.

The risk appetite is reviewed at least annually by the Board to ensure that it reflects the current external and market conditions. A revised risk appetite was last reviewed by the Board in December 2021.

Evolution of Tullow’s management of risk

During 2021, Tullow’s risk framework has been simplified and realigned to reflect the revised business structure and reporting lines. Senior risk owners have been working to ensure a greater culture of risk awareness and challenge is instilled throughout the business with an increased focus on mitigating actions. Further consistency in risk identification, measurement and reporting has been embedded across the organisation.

Tullow’s risk profile

The Company risk profile has been closely monitored throughout the year, with consideration given to the risks to delivering the revised Business Plan, as well as whether external factors such as the COVID-19 pandemic and oil price volatility have resulted in any new risks or changes to existing risks. The impact of these factors has been considered and managed across all principal risks. The following table represents the Company’s current principal risks.

Failure to deliver production targets (Commercial & Financial risk)
Risk details Risk mitigations
Tullow’s Business Plan is anchored on production from the Jubilee and TEN fields in Ghana and non-operated fields in Côte d’Ivoire and Gabon. A decline, or problems with the performance, of wells or facilities could result in not meeting planned production levels which in turn would lead to a reduction in revenue and cash flow ultimately impairing our ability to reduce leverage.
  • Robust control over Operations & Maintenance (O&M) contractor as well as ongoing O&M transformation project
  • Cross discipline integrated performance management including clear KPIs and forums
  • Maintenance and integrity management plans covering all equipment classes
  • Management and oversight of JV Partners to ensure maintenance and integrity plans are implemented effectively
A failure to grow the business via targeted investment in existing fields and/or investment in new fields could ultimately impact our ability to meet longer-term production targets.
  • Jubilee Expansion project, Jubilee South East, North East and TEN Enhancement Projects
  • Exploration strategy focused on acreage close to existing infrastructure, to enable discoveries to be converted to production quickly
  • Continued investment in non-operated portfolio, including accelerating projects where possible
  • Mergers & Acquisitions (M&A), inorganic growth with a focus on producing assets
Inability to secure associated gas offtake in Ghana could limit our ability to produce oil and impact revenue and value.
  • Working with the Government of Ghana to secure temporary flaring permit
  • Working to secure a long-term gas offtake commercialisation contract in Ghana as agreed in principle by the Board
  • Managing production processes to minimise production of gas which needs to be exported from the fields
Risk of a Major EHS incident (EHS or security risk)
Risk details Risk mitigations
A major incident could potentially result in asset integrity failures and/or extensive damage to facilities. This may in turn lead to a loss of life, environmental damage and potential for loss of production (and therefore revenue), increased costs and reputational damage.
  • Risk management processes embedded at all levels of the organisation
  • Asset and well integrity and maintenance programmes are in place, including regular self-verification and external certification, audit and assurance of integrity plans
  • Root cause failure analysis processes in place for production losses and EHS incidents to prevent recurrence and ensure lessons are learned
  • Emergency Response Plans and Incident Management Framework to aid in escalation when incidents do occur
Failure to unlock value (Stakeholder, Commercial & Financial risk)
Risk details Risk mitigations
Significant non-associated gas resource has been identified on current licences and failure to secure gas market share could delay development of these resources.
  • A workstream has been established to assess commercialisation opportunities within Ghana and the region that will enable development of the identified resources while playing an important role for the industrial development of Ghana

Delay in approval of a revised Field Development Plan (FDP) by the Government of Kenya could impact a final investment decision 

  • A revised FDP has been submitted to the Government of Kenya for approval in line with the licence extension requirements.
  • Continued engagement with the Government of Kenya and regulators to ensure timely approval of the revised FDP
Failure to secure a strategic partner would impact our ability to progress the project t final investment decision and unlock value 
  • The Kenya JV partners via an ongoing farm down process are actively seeking a strategic partner to fund the next stage of development and unlock value. Discussions are underway with potential bidders around a range of commercial arrangements
The inability to successfully explore and add accretive upside value to Tullow's assets through addition of reserves and resources around producing assets could limit the return on the licences.
  • Close collaboration focused on fully leveraging geoscience expertise to identify and mature reserves and resources which have the potential to rapidly unlock value for producing assets
  • This is reinforced by an Infrastructure-led exploration (ILX) strategy to strengthen the portfolio, by focussing on opportunities near producing assets, and create value through integration of assets, expertise and regional knowledge
The inability to limit our capital exposure to historic exploration commitments in selective emerging basins of Guyana and Argentina may result in having to divert capital from producing assets.   
  • A number of farm down processes are underway to limit capital exposure on selective emerging basins by aiming to reduce our equity share. This will ensure Tullow can participate at an equity consistent with our capital allocation guidance
Failure to manage geopolitical risks (Stakeholder & Financial risk)
Risk details Key mitigations
Political instability in the West Africa region, where our producing assets are concentrated, could delay and impact decision-making by host governments and local partners and may also impact security arrangements. 
  • An extensive relationship management plan is in place, to actively manage senior relationships with host governments, including an Advisory Board in Ghana
  • We ensure alignment of our business plans with national priorities and have developed a communication plan to educate stakeholders on the positive impact of our activities on host nations and communities
Unreasonable fiscal or regulatory demands by host governments could obstruct efficient operations, delay implementation of our growth plans and cause increased costs and financial loss.
  • We have robust stabilisation clauses in all our Petroleum Agreements and Production Sharing Contracts to protect us against unreasonable demands.
Failure to manage climate change risks (Climate risk)
Risk details Key mitigations

Tullow recognises climate change as a material, risk for our business.

There is a potential for climate related risks, including regulatory constraints, carbon pricing mechanisms, commodity market volatility or conditional access to capital, to affect Tullow’s ability to implement our strategy.

Challenges to our business strategy and failure to align with broader energy transition goals could result in reduced or conditional access to capital or shareholder/investor reluctance to invest.

Failure to deliver on our commitment to eliminate flaring by 2025 and thereby mitigate the carbon intensity of Tullow’s business may lead to stakeholder confidence erosion and impact our ability to attract and retain talent.
  • There is recognition and support from the Board that decarbonisation required investment. We are implementing our Net Zero plan to achieve Net Zero (scope 1 and 2) by 2030, to reduce our emissions and offset those hard to abate emissions
  • We stress test our portfolio to ensure core assets are resilient in different oil and carbon price environments
  • There is ongoing engagement with host countries to understand and align with their long-term energy transition strategies, including Paris Nationally Determined Contributions
Risk of insufficient liquidity and funding capacity to sustain and grow the business / failure to deliver a highly cash generative business (Financial risk)
Risk details Key mitigations

Tullow remains exposed to erosion of its balance sheet and revenues due to oil price volatility, unexpected operational incidents, ongoing costs associated with the COVID-19 pandemic and failure to deliver targeted farm downs of exploration assets and Kenya.

Failure to deliver our Business Plan could have a material negative impact on cash flow and our ability to reduce debt and strengthen the balance sheet, which may affect our ability to meet our financial obligations when they fall due.

  • Business plan in place to deliver strong cash flow and deleveraging
  • Capital structure provides liquidity headroom through to December 2024 even in a low oil price environment
  • Disciplined capital allocation prioritising high return and short payback investments, and a strong focus on cost control
  • Material commodity hedging programme against the impact of a sustained low oil price environment
Failure to develop, retain and attract capability (People risk)
Risk details Key mitigations

There is a risk that critical staff leave the organisation resulting in difficulty to deliver against our business plan.

We operate a lean and agile structure and are dependent on a small number of key and critical roles. Loss of staff would increase pressure on remaining colleagues and could lead to further deterioration in the wellbeing of our colleagues, a poor working environment and, potentially, further attrition.
  • A new Employee Value Proposition (EVP) was rolled out in 2021, covering culture, working environment, remuneration, learning and development and performance management
  • Employee engagement initiatives are in place, including an employee advisory panel, Tullow Townhalls, coffee mornings and employee engagement surveys
  • We have refreshed our inclusion and diversity (I&D) policy and hosted a number of speakers during the year, to increase awareness and reaffirm our focus on I&D
  • Succession plans are in place for critical roles. We have undertaken a leadership capability review of the extended leadership team, to ensure a focus on development and ensuring the right capability is in the organisation
Risk of a compliance or regulatory breach (Ethics & Conduct risk)
Risk details Key mitigations

The Company could be exposed to increased risk of non-compliance with bribery and corruption legislation or contractual obligations along with other applicable business conduct requirements.

In particular, an unforeseen material compliance breach could lead to regulatory action, an unsettled litigation/dispute or additional future litigation that may result in unplanned cash outflow, penalty/fines, reputational damage and a loss of stakeholder confidence in Management.
  • Tullow maintains high ethical standards across the business. Strong anti-bribery and corruption (ABC) governance processes/procedures are in place as a core element of the Ethics and Conduct (E&C) programme
  • A mandatory annual Code of Ethical Conduct eLearning and acknowledgement / certification process is in place for all employees. Third party due diligence procedures and assurance processes are in place
  • Investigation procedures and an associated Misconduct and Loss Reporting Standard are in place
  • Processes and controls are in place to deliver General Data Protection Regulation (GDPR) compliance
  • Anti-tax evasion risk assessments are undertaken with clear mitigation actions identified, including targeted employee training
Risk of major cyber-attack (Cyber risk)
Risk details Key mitigations

The external cybersecurity threat environment is continuously evolving and intensifying, therefore the risk of a major cyber-attack is an ongoing risk that requires constant monitoring and management.

Tullow may suffer an external cyber-attack which could have far reaching consequences for the business. This could limit our ability to operate, impact production, expose the company to high ransomware demands or potentially trigger a major incident. This could result in financial loss, loss of stakeholder confidence, loss of production, or additional cost by way of fines or resolution of service.
  • Security Incident Event Management (SIEM) system in place, supported by an Advanced Security Operations Centre (SOC) providing 24/7 network and device monitoring, alerting and response
  • Security awareness programme in place supported by regular staff susceptibility phishing training and testing. Annual mandatory security awareness training for all staff
  • An independent technical assurance programme is in place


Viability statement

Assessment period

In accordance with the provisions of the UK Corporate Governance Code, the Board has assessed the prospects and the viability of the Group over a longer period than the 12 months required by the ‘Going Concern’ provision. The Board assesses the business over a number of time horizons for different reasons, including the following: Annual Corporate Budget (i.e. 2022), Corporate Business Plan (5 years i.e. 2022–2026), long-term Business Plan (10 years). During 2021 the Board revised its period of assessment for the purpose of the Viability Statement, which was previously three years, to five years for the following reasons:

i. during the first half of 2021 the Group re-financed its near-term debt maturities with the issuance of Senior Secured Notes due in May 2026 (2026 Notes). The Group’s only other outstanding debt are Senior Notes due in March 2025, and therefore all of the Group’s debt matures outside of three years but within five years;

ii. in September 2021 the Group provided guidance to the market over a five-year period (2021-2025); and

iii.  this period also aligns with the Corporate Business Plan which targets an increase in production and operating cashflow generation over the next five years.

Notwithstanding the assessment period selected for the Viability Statement the Group will continue to assess the business over all time horizons noted above.

Assessment of the Group’s principal risks

In order to make an assessment of the Group’s viability, the Directors have made a detailed assessment of the Group’s principal risks, and the potential implications these risks could have on the Group’s business delivery and liquidity over the assessment period. This assessment included, where appropriate, detailed cash flow analysis, and the Directors also considered a number of reasonably plausible downside scenarios, and combinations thereof, together with associated supporting analysis provided by the Group’s Finance team. A summary of the key assumptions aligned to the Group’s principal risks and reasonably plausible downside scenarios can be found below. It should be noted that some assumptions encompass multiple risks but have not been repeated to avoid unnecessary duplication.

Principal risks Viability statement assessment Downside scenario
Failure to deliver production targets Production is assumed to be in line with the Corporate Business Plan. 5 per cent reduction in production in each year.

Failure to manage geopolitical risks

The Group has included probable outflow associated with tax exposures (refer to page 118 for a description of the Group’s uncertain tax treatments). In addition to the exposure included in the base case the Group has included $56 million related to potential outflows which are currently not deemed to be probable but whose likelihood is greater than remote.

Failure to manage climate change risks

The key impact of climate change on the Group’s portfolio of assets is reflected in the oil price assumptions. See below.

The Directors have considered an oil price sensitivity in line with the IEA “Net Zero by 2050 Scenario”; see below.

The Group has also assessed the impact of carbon pricing; refer to the TCFD disclosure.

Risk of insufficient liquidity and funding capacity to sustain and grow the business / failure to deliver a highly cash generative business

Oil price assumptions are based on the forward curve at 31 December 2021 for two years, followed by the Group’s Corporate Business Plan assumption from 2024 onwards: 2022: $76/bbl; 2023: $71/bbl; 2024: $62/bbl; 2025: $64/bbl; 2026: $65/bbl.

Operating costs and capital investment are assumed to be in line with the Corporate Business Plan.

The Group has analysed two downside oil price scenarios; the

first is based on the Directors’ assessment of a reasonably

plausible downside scenario: 2022: $60/bbl; 2023: $61/bbl; 2024: $62/bbl; 2025: $64/bbl; 2026: $65/bbl. The second is in line with the IEA 'Net Zero by 2050 Scenario': 2022: $62/bbl; 2023: $59/ bbl; 2024: $55/bbl; 2025: $52/bbl; 2026: $49/bbl.

12% increase in operating costs.


For detailed information on risk mitigation, assurance and progress in 2021 refer to the detailed discussion of risks on page 36.

For “Risk of an asset integrity breach”, “Failure to unlock value”, “Risk of a major EHS accident and Security”, “Risk of a compliance or regulatory breach”, “Failure to develop, retain and attract capability”, and “Risk of major cyber-attack” the Group has assessed that there is no reasonably plausible scenario that can be modelled in isolation or in combination with other risks from a cashflow perspective.


The Group has $2.4 billion notes outstanding, maturing in 2025 and 2026. The Corporate Business Plan does not project sufficient free cash flow generation to allow the Group to fully repay these notes when they fall due, and therefore it will need to access debt markets within the viability assessment period.

In the base case, net debt and gearing are forecast to reduce sufficiently such that the Directors are confident that the Group will be able to secure the funding required to maintain adequate liquidity headroom throughout the viability assessment period.

Under the two downside scenarios, execution of a refinancing would be challenging. Management is focussed on mitigating the risks around production, operating cost increases and potential outflows associated with disputes in order to reduce the likelihood of these risks materialising, or their impact in the event these risks materialise. Furthermore, the Directors have considered additional mitigating actions that may be available to the Group, such as incremental commodity hedging executed in periods of higher oil prices, alternative funding options, further rationalisation of the Group’s cost base including cuts to discretionary capital expenditure, M&A, portfolio management and careful management of stakeholder relationships.

Based on the results of the analysis and the ability to mitigate some of the risks associated with the downside scenarios, the Board of Directors has a reasonable expectation that the Group will be able to continue in operation and meet its liabilities, including through refinancing activities, as they fall due over the five-year period of their assessment.