Tullow Oil Issues Operational Update
Tullow Oil has issued the following Trading Statement in respect of the first half of the 2007 financial year and this Operational Update in respect of recent Production, Development and Exploration activities.
The Trading Statement is in advance of the Group's Interim Results, which are scheduled for release on Tuesday, September 4, 2007. The information contained herein has not been audited and is subject to further review.
-Ghana - Mahogany discovery – recent technical work indicates that there is significant further upside potential above current market estimates and a material proportion of the trap is within the Deepwater Tano block.
-Accelerated Ghana program – the Belford Dolphin drill ship has been secured to drill a further well in the Deepwater Tano block in August this year.
-Uganda - Nzizi-2 – this appraisal well confirms the lateral extent of oil bearing reservoir sands and tests an additional accumulation of gas at 14mmscfd.
-Uganda – rig contracted to drill the Ngassa and Kingfisher-2 wells later this year.
-Namibia - Kudu East appraisal campaign – the Kudu-8 well has commenced and is currently drilling at 2,652m. The well is intended to test the multi-tcf upside potential and is expected to reach the reservoir target at the end of July and start testing in August.
Production and Development
-Working interest production averaged 69,700 boepd for the first half of 2007, 11% higher than the same period in 2006.
-Production across the portfolio has been close to expectation with the exception of the UK where delays to drilling programs and the reallocation of capital, principally to Ghana and Uganda, have resulted in a reduction to 2007 production forecasts.
-The recent West Espoir (Côte d'Ivoire) and Okume Complex (Equatorial Guinea) developments continue to deliver above expectation. The Thurne and Kelvin development projects in the UK are on schedule for first production in Q4 2007.
-Working interest production for the Group is currently 75,000 boepd and is now expected to average 72-75,000 boepd for 2007.
Commenting today, Aidan Heavey, Chief Executive of Tullow said:
"Tullow's business has reached a new level in terms of scale and opportunity in the first half of 2007. The Mahogany well in Ghana has provided the Group's largest ever discovery, we have recorded excellent results from Uganda and our African assets have delivered a strong production performance. Future capital allocation will be focused on optimizing returns and accelerating activities on these high impact projects leading to a reduction in near term UK programs and production. Our key campaigns are delivering and we are confident of further success in the second half of the year."
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