In 2024, Tullow Oil, a British exploration firm, highlights the Kenya oil project as a primary focus for production growth. It anticipates generating $800 million in operating revenue from 2023 to 2025.
This is captured in its financial results for 2023, where Tullow reiterated the delivery of its plan, which is achieving targeted results and a much-improved business. During the year, Tullow continued to evolve and built a strong and unique foundation to create material value, the company reported.
Several significant milestones were achieved in 2023, including the start-up of Jubilee South East, which has given Ghana’s upstream sector a boost as Tullow delivered material production growth.
Tullow generated $170 million of free cash flow, ahead of expectations, and reduced net debt by over $250 million. Tullow also demonstrated its ability to access long-term funding through the $400 million debt financing agreement with the United Kingdom’s Glencore Energy.
It reiterated that it is on track to deliver production growth in 2024 and expects to deliver $800 million in operating revenue between 2023 and 2025. This outlook puts the company on a solid footing to consider growth.
The full-year results statement and presentation show that the Kenya Oil Project remains a material option to drive value and growth for Tullow Plc.
Last year, Tullow’s contingent resource in Kenya doubled to 470 million stock tank barrels (mmstb), with Tullow now holding 100 percent of the licence and a Field Development Plan (FDP) under discussion with authorities in the Kenyan government.
The increased interest provides Tullow with greater strategic flexibility, according to management, as it seeks partners to deliver the Kenya Oil Project.
According to Tullow Kenya BV (TKBV) Managing Director Madhan Srinivasan, an updated Field Development Plan (FDP) to develop 470 million barrels of oil equivalent per day of resources to produce up to 120,000 barrels of oil per day was submitted to the government in March 2023.
The firm, which plans to invest more than $10 million in Kenya this year, he disclosed, had received formal notification early this month from the Energy and Petroleum Regulatory Authority (EPRA) extending the review period of the updated Field Development Plan (FDP) to June 30, 2024.
While progressing the FDP, TKBV Tullow, Madhan added, is also actively working with the government of Kenya to develop options to accelerate production and cash flow to unlock value from the local asset.
These options, he said, are being explored with the government and will supplement Tullow’s Full Field Development (FFD) plan for Project Oil Kenya.
“We are collaboratively working with the government of Kenya as they evaluate the FDP. Once their evaluation is concluded, the FDP will be submitted to the Cabinet Secretary for Energy and Petroleum for review before submission to Parliament for final approval,” Madhan noted.
“We have designed the development to maintain robustness even at lower oil prices, and we are actively engaging in discussions with potential strategic partners for this project,” he elaborated.
