25th Nov 2020 13:49
(Alliance News) - Tullow Oil PLC on Wednesday said it intends to implement a new strategic plan that aims to generate USD7 billion of operating cash flow over the next 10 years, with the bulk of that available for debt service and shareholder returns.
The strategy and plan were announced during a Capital Markets Day event held by Tullow Oil on Wednesday. The London-based company said that the plan will focus more than 90% of future capital expenditure on Tullow's West African producing assets. Tullow Oil hopes that USD2.7 billion in capital investment from 2021 to 2030 still will leave USD4 billion in cash flow for debt service and shareholder returns.
Tullow Oil said its new plan will deliver production growth in the medium term and the ability to sustain production over the longer term. The first phase of investment will start in the second quarter of 2021 with the commencement of a multi-well drilling programme in Ghana.
Chief Executive Rahul Dhir said: "Following hard work by our team, and with input from our partners and external experts, we have a clear strategy and plan for the next 10 years. The plan focuses our capital on a deep portfolio of short-cycle, high-return opportunities within our current producing asset base and will ensure that Tullow can meet its financial obligations and deliver material value for our host nations and investors."
Tullow, which produces in West Africa and is exploring in Kenya and South America, said group working interest production in 2020 to date has been 75,000 barrels of oil per day, in line with expectations. Full-year guidance remains 73,000 to 77,000 bopd.
Shares in Tullow Oil were down 8.9% at 30.81 pence in London on Wednesday.
By Zoe Wickens; [email protected]
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