Tullow Gets Thumbs Up from Ghana Govt to Develop Jubilee

Tullow Oil announced that on July 13, 2009, the Minister of Energy in Ghana formally approved the Jubilee field Phase 1 Development Plan and Unitization Agreement on behalf of the Government of Ghana.

The Jubilee field will be developed via a Floating, Production, Storage and Offtake vessel (FPSO) and will deliver a plateau oil rate of 120,000 bopd, water injection capacity of 230,000 bwpd and gas export and injection capacity of up to 160 mmscfd. Work on the FPSO and subsea facilities was initiated in July 2008 and is on track to deliver first oil in the second half of 2010. It is estimated that phase-one development will produce in excess of the planned 300 million barrels of recoverable oil.

The phase-one development plan calls for up to 17 wells, including up to nine oil producers, five water injection wells and three gas injection wells. Water, and possibly gas, injection wells are intended to enhance production and maximize oil recovery by maintaining reservoir pressure. The development process has been designed so that produced gas will be available for export to shore and/or reinjected into the reservoir, thereby eliminating gas flaring.

The Unitization Agreement has determined the partners' initial equity interests in the Jubilee field and provides for modification of these interests as further field data becomes available. Tullow's initial equity interest in the Jubilee Unit Area, which Tullow will operate, is 34.70%. Other partner interests are Kosmos Energy (23.49%), Anadarko Petroleum (23.49%), Sabre Oil & Gas (2.81%), EO Group (1.75%) and the Ghana National Petroleum Corporation (GNPC) (13.75% of which 10% is carried interest).

Commenting today, Paul McDade, Chief Operating Officer, said, "Receiving formal approval from the Government of Ghana is an important milestone for the Jubilee Phase 1 development and supports our decision to fast-track the project early in 2008. By securing rig capacity and commencing the construction and drilling phases in advance, Tullow is confident that it will deliver first oil from this deepwater project just over three years since the first discovery well was drilled."