Tullow Oil moves forward on Ghana licence extensions and gas agreement

Tullow CEO Ian Perks, who assumed the role in September, highlighted the company’s objectives in a recent trading update.

In June, Tullow and its partners, PetroSA, Kosmos Energy, Ghana National Petroleum Corporation and Explorco, signed a memorandum of understanding with the Ghanaian Government.

The agreement relates to the West Cape Three Points and Deep Water Tano blocks.

Tullow’s latest update highlighted that a new gas sales contract has been executed for the Jubilee field, providing clarity on gas pricing for the duration of the extended licences.

The company is currently addressing outstanding issues including securing payment mechanisms for gas sales and an updated plan of development for Jubilee, which will necessitate approval from parliament.

Production at Jubilee averaged approximately 61 000 bpd gross (23 900 net to Tullow) through October, backed by the completion of a new production well this year.

Drilling of a second well, J73-P, commenced this month and is expected to start producing by the end of the year.

The TEN field has produced approximately 16 000 bpd, surpassing expectations due to strong performance from the Ntomme and Enyenra fields.

Uptime for floating production storage and offloading vessels at both sites averaged 97% up to the end of October.

Looking ahead, Tullow has approved a drilling programme for 2026 involving five wells, comprising four committed (three producers and a water injector) and one optional producer.

The company is also conducting an ocean bottom node seismic survey and integrating new four-dimensional seismic data to refine reservoir models and inform future drilling.

On the financial side, Tullow has concentrated on improving its balance sheet through asset disposals, having completed the sale of its interests in Kenya for at least US$120 million (£91.65 million) and its Gabon assets for around US$300 million after taxes.

Tullow is now in talks with bondholders and investors about refinancing options ahead of a bond maturity in May 2026.

Receivables owed by the Ghanaian Government, including development debt for TEN and overdue cash calls, totalled more than US$200 million (2.22 billion cedis) net to Tullow as of last month.

Perks said: “Our near-term priority remains to put Tullow on a long-term sustainable financial footing. To achieve this, we are focused on maximising operational efficiency in Ghana, cost optimisation and refinancing the Group’s capital structure.

“We are encouraged by the early successes in the recent Ghana drilling campaign and have spudded the second well in the programme. Looking ahead into 2026 we will look to optimise production through management of the decline and the additional production from new wells.”

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