Tullow Oil UK returns to profitability on the back of lower impairments and asset revaluation gains
Tullow Oil, an oil and gas exploration company based in West Africa, reported on Tuesday that it returned to profitability last year. This was largely due to a decrease in impairments, and asset revaluation.
The company's shares rose by 3.9% early in trading after it reported a profit after taxes of $55 millions for the year ending December 31, 2024. This compares to a loss in 2023 of $110,000,000 when the company reduced the value of one of its West African Oilfields.
Richard Miller, interim CEO of the company, said that there was "strong momentum" within the business. This included a return to drilling on (the) Jubilee field and a start-up of production optimization and reserve maturation activities in Ghana.
By Monday's closing, shares in the company fell 16.9% over the past 12 months.
Peel Hunt analysts stated that Tullow’s 2024 results are in line with expectations. They added that the company should be able to "unlock" upside for the year if it confirms a permanent CEO and refinanced bonds, as well as settled tax disputes.
Tullow, which announced in December that Rahul Dhir was stepping down as CEO, exempted the company from paying a tax of $320 million on its Ghana operations. Richard Miller, Tullow's finance chief, became interim CEO last month.
As part of its efforts to reduce debt, Tullow announced on Monday that it had agreed to sale its entire working interest in Gabon to $300 million cash.
The company stated on Tuesday that its main goals for the coming year would be to advance its refinancing program, improve production efficiency at the flagship Jubilee Field and the TEN Project, both in Ghana and expand its reserves.
Tullow reported that its average production in 2024 will be 61.2 thousand barrels equivalent per day (kboepd), a slight decrease from the 62.7 kboepd of 2023. Reporting by Aby José Koilparambil in Bengaluru, Anandita Moretra and Pushkala Arikaka; editing by Rashmi aich and Susan Fenton
(source: Reuters)
