Tullow Oil decides $33mn interim payout, revises output down

Fawad Maqsood July 24, 2019

LONDON: The board of British oil producer Tullow will pay an interim dividend of 2.35 cents per share, representing a payout of about $33 million, it said on Wednesday, as part of plans to pay out at least $100 million a year.

The group’s first dividend since suspending payouts in 2015 follows a first half in which it doubled post-tax profit, to $103 million.

But due to problems at its TEN fields in Ghana, Tullow  downgraded its 2019 output guidance to 90,000-94,000 barrels of oil equivalent per day (boed).

In April, Tullow had cut its guidance to 90,000-98,000 from 93,000-101,000 bpd, excluding around 1,000 boed in gas production.

“(The) revision to 2019 TEN production guidance… is likely to push 2019 cash flow estimates lower, with the risk that it also tests investor confidence in the group’s medium term production profile,” Barclays said in a note.

After having flagged delays for its East African onshore oil projects, Tullow said it now targets a final investment decision for its Kenyan onshore oilfields in the second half of 2019.

In Uganda, a tax dispute has delayed the payment of over $200 million to Tullow after it sold part of a project to Total .

Tullow reiterated that it is “considering all options in pursuing the sale of its interests in Uganda.”

Tullow expects first results from its drilling programme off Guyana in the first half of next month.

Copyright Reuters, 2019

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