Tullow to Focus on Less Exploration over Oil Prices

2016 Views Kampala, Uganda

In short
Tullow says its share prices rose in 2015 in line with expectations but it will now focus towards developing already discovered oil across twenty two countries.

Tullow oil says it is to focus on extracting oil from already discovered oil and have fewer activities in oil exploration.

The company which is also involved in Uganda's oil industry today announced in its 2015 trading statement that  it expects to deliver revenue of 1.6 billion dollars in line with market expectations.

Pre-tax operating cash flow is expected to be delivered at $1bn for 2015, while gross profit is expected to come in at $600m, which are also in line with market expectations.

Despite the profit, Tullow says has reset its strategy to focus on extracting as much value from current assets, concentrating less on exploration. Tullow oil, like others in the oil industry has been affected by a lower global oil price.

Tullow chief executive, Aidan Heavey in a statement said  the company  in 2015 did not only reset its business to deal with what he called very difficult market conditions but also delivered on its key operational goals. 

He said the company will continue to focus on driving down its costs and capital expenditure and that from the beginning of 2016, it has Tullow has a mark-to-market hedge value of over $600 million and financial headroom of $1.9 billion.

Mark-to-market hedge value is the accounting act of recording the price or value of a security, portfolio or account to reflect its current market value rather than its book value.

Tullow is one of the leading independent oil & gas, exploration and production groups. The Group has interests in over 120 exploration and production licences across 22 countries including Uganda and neighboring Kenya.

Aidan Heavey reported that there has been steady progress towards a potential development of oil in East Africa in 2017.

He said their appraisal programme in Kenya has proved up commercial resources and that plans for further exploration drilling will be evaluated duri