Proactive Investors - Tullow Oil PLC (LON:TLW) told investors it is performing ahead of its cash flow expectations as it grows production from its key asset offshore Ghana.
The company today marked its full-year production volumes at 63,000 barrels oil equivalent per day, with the start-up of the Jubilee South East operation lifting volumes.
Significantly, chief executive Rahul Dhir described a “major inflection point as we [Tullow] moved from a period of investment focus to delivery of free cash flow growth”.
Dhir, in today’s statement, added: “We are on track to deliver c.$600 million free cash flow over the next two years to achieve our stated target of c.$800 million of free cash flow from 2023 to 2025 at $80/bbl.
“The debt facility agreed with Glencore (LON:GLEN) is a strong endorsement of our business plan and we have no material uncovered debt maturities until May 2026.
“At the same time our assets are expected to deliver production growth, while we continue to maintain our laser focus on operational excellence and capital discipline."
Operationally, Tullow noted that Jubilee South East added around 6,000 barrels oil equivalent of daily gas production.
In terms of financials, the company flagged $1.6 billion of revenue generation in the period, after hedging costs of $140 million; meanwhile, it noted that capital and decommissioning spend amounted to $380 million and $70 million respectively.
Tullow Oil said it achieved underlying operating cash flow of around $800 million and a free cash flow of $170 million.
Giving its outlook for 2024, Tullow forecasts a working interest production average between 62,000 and 68,000 boepd.
Capex for the year is estimated at around $250 million and it forecasts free cash flow between $200million and $300 million, assuming an oil price of $80 per barrel.