Tullow Oil Maintains 2017 West Africa Working Interest Production Guidance

LONDON--Tullow Oil PLC (TLW.LN) Wednesday maintained its West Africa working interest oil production guidance, but said production from Europe is expected to fall slightly due to deferment and delays in some activities.

Tullow's West Africa working interest oil production full year guidance of between 78,000 and 85,000 barrels of oil per day or bopd for 2017, including production-equivalent insurance payments, remains unchanged.

Full year gas production from Europe averaged 5,600 barrels of oil equivalent per day or boepd in the year to date, which is slightly lower than expectations due to deferment and delays in some activities, it said. Tullow expects full year 2017 European gas production to now average between 5,500 and 6,000 boepd.

The group expects to generate $0.6 billion of pre-tax operating cash flow (before working capital) for the first half of 2017. This is higher than the first half of 2016 as a result of insurance proceeds, contributions from TEN, and increased contributions from Jubilee.

The group also expects to incur $0.6 billion pre-tax ($0.4 billion post-tax) of non-cash impairment of property, plant, and equipment due to reduced oil price forecasts.

Tullow said its capex guidance for the year has been revised from $0.5 billion to $0.4 billon. This change reflects a revision to prior year accruals in Ghana and lower forecast expenditure across the portfolio. The deferred consideration from the Uganda farm-down, once completed, would further reduce the overall Group capex for 2017 to $0.3 billion, the company said.

-Write to Razak Musah Baba at razak.baba@wsj.com; Twitter: @Raztweet

(END) Dow Jones Newswires

June 28, 2017 02:37 ET (06:37 GMT)

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