Tullow Oil to Concentrate on it Producing Assets in 2022

2022 Outlook

  • Group working interest oil production guidance is 55 to 61 kboepd. This forecast is based on Tullow’s existing equity interests in TEN (47.175%) and Jubilee (35.48%) and will be adjusted following completion of the pre-emption of the sale of Occidental Petroleum’s interest in Ghana to Kosmos Energy. The estimated full year impact of the completed pre-emption would be an addition of c.5 kboepd (net) to the Group’s 2022 production forecast, adjusted for completion timing.
  • Tullow is prioritising investment in high return opportunities in its producing assets, whilst ensuring the business remains self-funded at c.$65/bblthis year. Capital expenditure is forecast to be c.$350 million, split c.$270 million in Ghana, c.$30 million on the non-operated portfolio, c.$5 million in Kenya and c.$45 million on exploration and appraisal. Decommissioning expenditure is expected to be c.$100 million.
  • Increased year-on-year spend in Ghana is primarily due to investment in infrastructure for the Jubilee North East and South East areas that will lead to meaningful growth in production as these undeveloped parts of Jubilee are brought on stream from 2023 onwards.
  • At $75/bbl, underlying operating cash flow1 is expected to be c.$750 million with free cash flow2 of c.$100 million.
  • Debt reduction remains a key priority and the Group remains on track to materially reduce net debt and achieve gearing of less than 1.5x net debt to EBITDAX by 2025.
  • A material hedge portfolio protects c.75% of forecast sales volumes to May 2023 and 50% from May 2023 to May 2024.


Jubilee – 2022 outlook

  • Jubilee production is expected to average between 80 to 84 kbopd (net: 28 to 30 kbopd). This includes the impact of a planned maintenance shutdown of approximately two weeks, scheduled to take place in the second quarter.
  • Three new wells are planned to be drilled at Jubilee in 2022. A water injector is due onstream in the first quarter, which will provide pressure support to existing producers. This will be followed by a producer and a second water injector.
  • The work programme is focused on delivering reliable in-year production through continued infill drilling as well as investment in projects that will access undeveloped resources and lead to meaningful production growth in subsequent years.
  • This investment will focus on new infrastructure to support the development of over 170 mmbbls gross estimated ultimate recovery (EUR) in previously undeveloped areas in the eastern parts of the field.
  • As part of a longer-term operational transformation plan, Tullow, supported by its Joint Venture (JV) Partners, has taken the decision to self-operate the Jubilee FPSO and will take over all operations and maintenance (O&M) from MODEC when the current O&M contract comes to a scheduled end in 2022. This presents an opportunity to realise further efficiency improvements whilst sustaining top quartile production operating performance in terms of safety, emissions, reliability, costs and local content.
  • As part of Tullow’s commitment to becoming a Net Zero Company by 2030 on its Scope 1 and 2 emissions, the scheduled shutdown on the Jubilee FPSO will help facilitate increased gas handling capacity. Planned facility modifications will support increased gas export capability and help towards the target of eliminating routine flaring in Ghana by 2025. Other activities planned during the shutdown will focus on maintenance, integrity and reliability of the FPSO for the long-term.

TEN – 2022 outlook

  • TEN oil production is expected to average between 22 to 26 kbopd (net 11 to 12 kbopd), driven by natural decline in the existing wells.
  • The JV Partners have identified material potential across TEN and a coordinated effort to improve field performance is under way with plans to accelerate production from undeveloped resources in the Greater Ntomme and Tweneboa (GNT) areas.
  • Drilling in 2022 will focus on further defining future development plans to maximise production and the fields’ value potential. Two strategic development wells are to be drilled in the Ntomme riser base area and an additional well is planned in the Enyenra area in the second half of the year. The JV is also investing in the infrastructure required to allow these wells to be brought on stream from 2023.

Pre-emption of Occidental Petroleum/Kosmos Energy transaction

  • As previously announced, in November 2021, Tullow exercised its right of pre-emption related to the sale of Occidental Petroleum’s interests in the Jubilee and TEN fields to Kosmos Energy for an expected consideration of c.$150 million. Consequently, Tullow’s equity interests are expected to increase to 38.9% in the Jubilee field and 54.8% in the TEN fields upon completion of the transaction. Completion of the transaction remains subject to finalising definitive agreements with Kosmos Energy/Anadarko WCTP Company, and securing approval from the Government of Ghana.


  • Production from Tullow’s non-operated portfolio was 17.2 kboepd in 2021. Production in 2022 is expected to average between 16 to 19 kboepd.
  • During 2021, Tullow divested its interests in the Ceiba and Okume fields in Equatorial Guinea and the Ruche field in the Dussafu Marin permit in Gabon, receiving a total consideration of $133 million following completion of the sales in March and June respectively.
  • In Gabon, the Simba expansion project progressed well in 2021, with a successful infill well drilled and a new 10-inch offtake pipeline installed at the end of the year. Consequently, net production for the Simba field in 2022 is expected to average c.6kbopd, 40% higher than in 2021.
  • In the fourth quarter of 2021, the Tchatamba JV Partners made a near field discovery with the TCTB-14 well in the Tchatamba South licence in Gabon. This discovery will undergo a long-term production test during 2022.
  • The Espoir field in Côte d’Ivoire had to be shut down twice in 2021 following a major incident in January 2021 and required maintenance works on the FPSO’s cargo tanks. The field is now back onstream and Tullow continues to engage with the operator (CNR International) on further remediation plans for the FPSO and on identifying development drilling opportunities.


  • In December 2021, as per the licence extension obligations provided by the Government of Kenya in September 2020, the Project Oil Kenya JV Partners submitted a Field Development Plan for the 10BB and 13T licences, including the additional exploration and appraisal (E&A) opportunities within the 10BB and 13T licences. The E&A plan for 10BA was also submitted.
  • The JV Partners continue to seek a strategic partner for this project and constructive discussions continue with interested parties.


  • In January 2022, Tullow also exited the PEL 90 licence in Namibia, further optimizing its portfolio.
  • In Côte d’Ivoire, Tullow, together with its JV Partner PetroCi, has elected to proceed into the second exploration phase in Block CI-524, adjacent to the TEN fields in Ghana.

Rahul Dhir, Chief Executive Officer, Tullow Oil plc, commented today:

“2021 was a year of positive change and transformation for Tullow, and we ended the year on a firm financial and operational footing. The delivery of our long-term Business Plan is progressing well with significant improvements in safety, operating efficiency and drilling performance. In 2022, we will build on these firm foundations and focus on investing in our producing assets in West Africa. Our plans in Ghana, where we are in the process of increasing our stakes in both the Jubilee and TEN fields, will position us to deliver the free cash flow to reduce gearing to less than 1.5x by 2025. Elsewhere, our Gabon near-field non-operated exploration opportunities, our revised Kenya development project and the Beebei-Potaro commitment well in Guyana also have the potential to be significant value drivers for Tullow. There is much to look forward to this year.”

Leave a Reply