Tullow Oil plc Trading Statement and Operational Update

The Trading Statement is in advance of the Group's Interim Results, which are scheduled for release on Wednesday, 27 August 2008. The information contained herein has not been audited and is subject to further review.

HIGHLIGHTS

Exploration

• Mahogany-2 appraisal well on the Jubilee field in Ghana extends upside potential to 1.8 billion barrels.
• Jubilee and Odum have proved two new plays and de-risked substantial follow-up prospects scheduled for drilling in Ghana and Côte d'Ivoire within the next 12 months.
• Kingfisher-2 well in Uganda intersects zones encountered in Kingfisher-1, deep target results expected in August.
• Ugandan Butiaba campaign yields three more discoveries and opens up a new geological fairway.
• Four-well drilling campaign in India commenced in Block CB-ON/1 in late June.

Production and Development

• Group working interest production averaged 70,550 boepd for the first half of 2008 and is expected to average between 70,000 and 72,000 boepd for the full year.
• Jubilee production facilities tender under way and on track to achieve first oil target of 2010.
• Three deepwater rigs contracted for Ghana, next phase of drilling to commence in September.
• Early Production System in Uganda is expected to be sanctioned in the third quarter 2008.

Finance and Portfolio Management

• Successful portfolio rationalisation in the first half of 2008 will raise approximately US$1 billion and a total anticipated profit on disposal after tax of approximately £400 million on completion.
• Capital expenditure in first half was £170 million, planned expenditure for 2008 is forecast to be £480 million.
• Net debt at 30 June 2008 was £420 million.

Download Tullow Oil plc Trading Statement and Operational Update (PDF, 160 KB, opens in a new window)

Commenting today, Aidan Heavey, Chief Executive, said:

"Tullow has performed exceptionally well over the first half of 2008. We have had solid production performance, outstanding appraisal results in Ghana, continued exploration success in Uganda and announced almost $1 billion worth of non-core disposals to enhance our financial and operational flexibility. These factors, combined with the unprecedented strength in oil and gas pricing and our ongoing exploration programmes mean that Tullow has never been in a better position to enhance shareholder value."

Disclaimer

This announcement contains certain operational and financial information in relation to the first half of 2008 that is subject to final review and has not been audited. Furthermore it contains certain forward-looking statements that are subject to the usual risk factors and uncertainties associated with the oil & gas exploration and production business. Whilst the Group believes the expectations reflected herein to be reasonable, the actual outcome may be materially different owing to factors either within or beyond the Group's control, and accordingly no reliance may be placed on the figures contained in such forward looking statements.