Tullow Oil has completed the pre-emption related to the sale of Occidental Petroleum’s interests in the Jubilee and TEN fields in Ghana to Kosmos Energy.
The cash consideration paid on completion was US $118M reflecting closing adjustments and was funded from cash on the balance sheet. This transaction takes Tullow’s equity interests to 38.9% in the Jubilee field and to 54.8% in the TEN fields and adds approximately five kbopd of unhedged daily production.
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This equates to approximately 4 kbopd on an annualised basis and increases 2022 Group production guidance to 59-65 kbopd (30-32 kbopd at Jubilee, 13-14 kbopd at TEN and non-op portfolio unchanged at 16-19 kbopd).
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Equity
This additional equity increases Tullow’s 2022 Group capital expenditure forecast by US$30Mto US $380M and is expected to generate approximately US$300mn incremental free cash flow at US$75/bbl between 2022 and 2026. As of 31 December 2021, the transaction increases Tullow’s net 2P reserves by approximately 21 mmboe (9%) and has an estimated post-tax NPV 10 valuation of US $355mn at $75/bbl.
“I am delighted that this important transaction has completed and I am grateful for the continued support of the Government of Ghana and, in particular, the Honourable Minister of Energy whose leadership has been paramount in getting to completion. This transaction underscores our confidence in the assets and meets our objectives of value accretion and deleveraging,” Rahul Dhir, CEO of Tullow Oil plc.
Tullow Oil plc is a multinational oil and gas exploration company founded in Tullow, Ireland with its headquarters in London, United Kingdom. The company is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index.
