Tullow Oil Plc cut the upper end of its 2015 forecast for West African oil production after operations in Ghana were affected by a gas-compression fault earlier this year.
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Tullow’s Ghana TEN project is about 75% complete and on schedule to deliver first oil in the middle of next year.
Tullow Oil has reduced its 2016 capex budget by more than a third below this year’s investments to $1.2 billion, slashing costs as weak oil prices continue to eat into its profit.
The Tweneboa, Enyenra and Ntomme (collectively the TEN), touted as Tullow’s second flagship project behind the Jubilee field, is projected to produce up to 80,000 barrels of crude per day at maximum capacity.
Tullow’s shares have been sliding over the year, but rallied on Monday on the news that Africa Oil would be selling assets that Tullow also owns a significant stake in to Moeller-Maersk, providing a much-needed cash injection of $845m.
Output from the region will be 66,000 to 67,000 barrels of oil equivalent a day this year, the London-based company said Wednesday in a statement.
“Whilst 2015 has been a hard year across the industry, we have taken appropriate steps within our business to meet the challenges presented by lower oil prices”, said chief executive Aidan Heavey. That should fall for 2016 by 36 percent to $1.2 billion.
In a trading update published this morning the company said TEN “is around 75pc complete and on schedule and on budget to deliver first oil in mid-2016”. Once production from TEN commences in mid-2016, Tullow expect to begin to reduce debt.
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Drilling resumed in Kenya last month, starting with the Emesek-1 well and the programme will continue into 2016.
