Tullow Oil Plc Expects a Revenue of $1.6 Bln for 2015, 28% lower than 2014

January 18
6:30 AM 2016

Tullow Oil Plc, a leading oil and gas explorer, said that it expects to record a revenue of $1.6 billion for the year 2015, a decrease of 28 percent from the $2.2 billion reported last year. In the company's trading update published on Wednesday, Tullow said it expects its gross profit to be $600 million for the full year, which is down from $1.1 billion reported in fiscal 2014.

The oil & gas explorer said it anticipates to suffer an impairment charges of $0.9 billion for the full year. The company expects its gross profit to be $0.6 billion for the full year

Impairment charges combined with a 16 percent fall in revenues and noteworthy write-offs forced Tullow to report first ever pre-tax loss of $2 billion in 2014.

The company said its TEN project in West Africa, which is more than 80 percent complete, continues to progress within the budget. Tullow expects normal working interest production in TEN project to be around 23,000 bopd gross in 2016.

The oil explorer is also expecting 2016 normal production to be nearly 101,000 bopd gross from Jubilee project and West Afric non-operated production to be nearly 29,500 bopd net.

The Irish Times quoted analyst Caren Crowley as saying, "Liquidity entering 2016 is $200 million better than anticipated after capital expenditure in 2015 was squeezed. Guidance for investment in 2016 is largely unchanged. However, similarly to 2015, management hopes to beat capital expenditure guidance by up to $200 million as we move through the year,"

Marketwatch said that the company expects West Africa working interest oil production to be in the range of 73,000 to 80,000 barrels of oil per day.

Commenting on the report, Aidan Heavey, Chief Executive Officer of Tullow, said, "In 2015, Tullow not only reset its business to deal with very difficult market conditions but also delivered on its key operational goals. Strong West African oil production supported by a significant hedge programme delivered pre-tax operating cash flow of $1 billion. We also made excellent progress on the development of the TEN Project which is on track to begin production in the middle of 2016 and we expect the Group to be producing around 100,000 bopd in West Africa in 2017. In East Africa, steady progress has been made towards a potential development sanction in 2017".

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