REG - Tullow Oil PLC - Trading Statement
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RNS Number : 8197T Tullow Oil PLC 20 February 2026
Tullow Oil plc
Trading Statement
20 February 2026 - Tullow Oil plc (Tullow) issues the following statement in
advance of the Group's 2025 Full Year Results. The information contained
herein has not been audited and may be subject to further review and
amendment.
Ian Perks, Chief Executive Officer, Tullow Oil Plc, said: "2025 has been a
year of disciplined execution across the business. This includes strong
operational momentum which continues with excellent results from the latest
Jubilee well and a further five wells due onstream this year to support our
production targets. We have achieved significant cost reductions and completed
the sale of non-core assets in our ongoing efforts to streamline our portfolio
and strengthen our financial position.
"However our 2025 full year free cashflow was negatively impacted by the
commodity price environment towards the end of the year and delays in receipt
of Government of Ghana receivables and the second instalment of proceeds from
the Kenya disposal.
"The refinancing transaction we have announced today enables us to focus on
delivering our near-term priorities, which include driving further cost
efficiencies, improving cashflow management and optimising our production."
2025 Performance
Operational
* Full year working interest production averaged c.40.4 kboepd in 2025,
including c.7.1 kboepd of gas, reflecting the sale of the Gabonese assets
effective from the start of the year.
* Gross production from Jubilee was c.60.9 kbopd (c.23.7 kbopd net to Tullow),
reflecting a 15-day planned maintenance shutdown in the first half of the
year, but supported by good performance from the J72-P production well which
was brought onstream in July.
* Gross production from TEN was c.16.0 kbopd (c.8.8 kbopd net to Tullow),
reflecting continued strong Ntomme and Enyenra performance.
* 2025 production exit rates were c.57 kbopd from Jubilee and c.15 kbopd from
TEN.
* Towed streamer 4D seismic and Ocean Bottom Node seismic surveys on the Jubilee
and TEN fields were completed in the first and fourth quarters, respectively.
Interpretation of the 4D seismic data continues to deliver informative
reservoir insights, supporting optimised well design and placement in the
current drill programme and the identification of targets for future
campaigns.
* Overall FPSO uptime at Jubilee and TEN averaged 97% in 2025.
* Full year working interest production from the non-operated Espoir field in
Côte d’Ivoire was c.1.2 kboepd.
Financial
* 2025 revenue of c.$847 million (including c.$19 million hedge costs) at an
average realised oil price (pre-hedging) of $67.8/bbl.
* 2025 capital and decommissioning expenditure were c.$166 million and c.$17
million respectively, in line with guidance.
* 2025 free cash flow of c.$100 million, the reduction from previous guidance
primarily relates to:
o Delay in receipt of the second instalment of proceeds from the Kenya
disposal ($40 million) related to the ratification of the approved Field
Development Plan, now expected during the first quarter of 2026,
o Delay in receipt of cash calls (c.$40 million) and gas payments (c.$100
million) from the Government of Ghana, and
o Lower revenue in November and December of 2025 (c.$20 million).
* Government of Ghana receivables as at 31 December 2025 were c.$225 million net
to Tullow (pre-tax), with c.$65 million related to cash calls, c.$110 million
related to gas payments and c.$50 million related to TEN development debt.
Tullow is working with the Government of Ghana and its agencies to resolve
these outstanding balances.
* The hearing for Business Interruption Insurance arbitration completed in
November 2025, with a result not expected until the second half of 2026. The
hearing in relation to the loan interest arbitration has been scheduled for
September 2026. Tullow has advanced discussions with the Government of Ghana,
with the aim of resolving the assessments on a mutually acceptable basis.
* Cost base optimisation has delivered savings of c.$10 million, reducing 2025
net G&A to c.$43 million, with targeted savings of c.$50 million over the
next three years compared to 2024.
* Free cash at 31 December 2025 was $322 million and is expected to be
materially consistent at 31 May 2026, subject to working capital movements.
* Year-end net debt reduced to c.$1.35 billion with liquidity headroom of over
$300 million.
Reserves and resources
* Independently audited 2P reserves at year end 2025 of 100.4 mmboe (2024: 164.5
mmboe), valued at c.$1.3 billion (NPV10 at Strip Price). Please see TRACS
Independent Audit of Tullow Petroleum Assets 2025, published here:
https://www.tullowoil.com/investors/results-reports-and-presentations/
(https://www.tullowoil.com/investors/results-reports-and-presentations/)
.
* Reserves reduction includes 14.7 mmboe of Group production in 2025, the
disposal of the Gabon assets (36.0 mmboe), a downward revision on Jubilee
reflecting production performance (11.8 mmboe) and a minor reduction on TEN
(1.6 mmboe) which reflects rephasing of projects and an earlier assumed
cessation of production due to a lower evaluation oil price.
* The magnitude of the Group's estimated 2C resources c.200 mmboe (2024: c.700
mmboe), following the sale of the Kenyan (c.460 mmboe) and Gabon assets (c.30
mmboe), continues to reflect the material opportunity Tullow has to mature
resources into reserves in Ghana. A number of tangible near-term projects are
being matured during 2026 to realise this, including opportunities such as:
subsea pumps and further infill drilling on Jubilee and TEN, plus the
potential monetisation of TEN non-associated gas resources.
Strategic
* On 25 September 2025, Tullow completed the sale of its entire working interest
in Kenya, receiving consideration of $40 million upfront and expects to
receive a further $40 million due on ratification of the approved Field
Development Plan (FDP) during the first quarter of 2026, with a back-stop of
30 June 2026. A final payment of $40 million will be received over five years
from the third quarter of 2028 onwards.
* Tullow is aware of a tax assessment for c.$170 million from the Kenya Revenue
Authority relating to alleged underpaid VAT and Capital Gains Tax on the
disposal of its 100% shareholding in its Kenyan subsidiary, Tullow Kenya BV,
to the Gulf Energy Group for a minimum consideration of $120 million. Tullow's
clear and firm position is that the assessment is wholly without merit and
intends in conjunction with Gulf Energy to contest the assessment through the
regular objection process. There will be no cash outflow in respect of lodging
these objections, nor does Tullow expect cash outflow on completion of its
appeal process.
* On 29 July 2025, Tullow completed the sale of Tullow Oil Gabon SA for a total
cash consideration of $307 million net of tax and customary adjustments.
* On 19 February 2026, Tullow signed a Sale and Purchase Agreement to acquire
the TEN FPSO on behalf of the joint venture for a gross consideration of $205
million ($125.6 million net to Tullow), which is to be paid upon completion at
the end of the first quarter of 2027. Following completion Tullow intends to
maximise operational synergies with the adjacent Jubilee Field and drive
further cost efficiencies which will underpin the longer-term development of
the TEN and Jubilee fields.
* On 20 February 2026 Tullow announced that the extension of its West Cape Three
Points and Deep Water Tano Petroleum Agreements, which cover the Jubilee and
TEN fields, was ratified by the Ghanaian Parliament. Accordingly, these
agreements have been extended to 31 December 2040 and from 20 July 2036 Ghana
National Petroleum Corporation's share in the field will increase by a further
10% interest and the joint venture partners' shares will decrease pro rata.
* In addition, Tullow has secured revised terms for the supply of gas from the
Jubilee field to the end of the extended period at an escalating price of
$2.50/mmbtu. Tullow and the Government of Ghana have also agreed a gas payment
security mechanism and heads of terms for the potential supply of gas from
TEN.
* On 20 February 2026 Tullow announced an extension to its Senior Secured Notes
and Glencore facility to November 2028 and May 2030, respectively. It has also
agreed a new $100 million cargo pre-payment facility with Glencore to provide
additional liquidity. This strengthens Tullow's financial position to deliver
value for its stakeholders (see separate release).
2026 Outlook
* Group working interest production in 2026 is expected to average 34-42 kboepd,
including c.6 kboepd of gas.
* Group production guidance reflects a risked range of reservoir and operational
outcomes, based on a gross Jubilee mid-point of c.60 kbopd and a gross TEN
mid-point of c.12 kbopd.
* Decline mitigation activities include waterflood optimisation, which is
facilitated by increased water injection rates, and fluid lift optimisation
through management of well production through the riser system and riser base
gas lift.
* FPSO uptime associated with the low and high end of the range is 94-98%.
* Five planned Jubilee wells (four producers and one water injector) in addition
to the recently completed J74-P well are expected onstream in 2026.
* The J74-P well came onstream on 6 January 2026. The well encountered c.50
meters of net pay and initial gross production through the wellbore is c.13
kbopd. Back-out impact on other wells is currently being optimized through
dual riser flow and management of existing well stock.
* The rig has drilled J75-P, encountering three good reservoir intervals, and
this well is expected to come onstream around the end of the first quarter of
2026.
* Capital expenditure is forecast to be c.$200 million, decommissioning
expenditure is expected to be c.$25 million.
* Pre-financing cash flow(1) is now expected to be c.$150-180 million at
$65/bbl, the increase from previous guidance relates to:
o Inclusion of the delayed Kenya Tranche B payment ($40 million), and
o Inclusion of delayed cash call receivables due from the Government of
Ghana (c.$40 million).
* 2026 pre-financing cash flow(1) guidance includes c.$40 million for 2026
pre-tax gas revenues but excludes c.$110 million historical gas receivables
and the c.$50 million receivable related to TEN development debt. Tullow is
working with the Government of Ghana and its agencies to resolve these
outstanding balances on a mutually acceptable basis.
* Cash flow would reduce by c.$40 million at $60/bbl and by a further c.$20
million at $55/bbl.
* Following the Refinancing Transaction (see separate release) Tullow expects to
have liquidity headroom of free cash and undrawn facilities in excess of $200
million, providing liquidity buffer for a downside scenario and allowing for
c.$100 million working capital swings expected during 2026.
(1) Pre-financing cash flow is defined as underlying operating cash flow plus
net cash from/(used) in investing activities, decommissioning expenditure and
payments to/from decommissioning escrow fund.
CONTACTS
Tullow Investor Relations Camarco (Media)
(+44 20 3757 4980)
ir@tullowoil.com (mailto:ir@tullowoil.com)
Billy Clegg
Matthew Evans
Georgia Edmonds
Rebecca Waterworth
Notes to editors
Tullow is an independent energy company that is building a better future
through responsible oil and gas development in Africa. Tullow's operations are
focused on its core producing assets in Ghana. Tullow is committed to becoming
Net Zero on its Scope 1 and 2 emissions by 2030, with a Shared Prosperity
strategy that delivers lasting socio-economic benefits for its host nations.
The Group is quoted on the London and Ghanaian stock exchanges (symbol: TLW).
For further information, please refer to: www.tullowoil.com
(http://www.tullowoil.com/) .
Follow Tullow on:
LinkedIn: www.linkedin.com/company/Tullow-Oil
(http://www.linkedin.com/company/Tullow-Oil)
X: www.X.com/TullowOilplc (http://www.X.com/TullowOilplc)
APPENDIX - Key guidance metrics 1
Tullow 2P 2 Tullow Business Plan Tullow Upside
Assumptions 2P reserves 2P/2C reserves/resources 3P/3C reserves/resources
Petroleum Agreement extensions Total of 19 wells Total of 29 wells
Riser base gas lift 2029-30 well campaign 2031-32 well campaign
Total of 14 wells Two workovers 2034-35 well campaign
2025-26 well campaign Multi-phase pump
2027-28 well campaign
Two workovers
Asset NPV15 at $65/bbl3 ($ billion) 1.1 1.4 1.7
Average oil price 2026 65 65 65
($/bbl)
2027-28 67 67 67
2029-30 70 70 70
2031-40 79 79 79
Group production4 2026 34-42 34-42 34-42
(kboepd)
2027-28 36 ˆ 33 38 ˆ 42 40 ˆ 42
2029-30 32 ˆ 28 39 ˆ 41 47 ˆ 53
2031-40 25 ˆ 7 37 ˆ 12 47 ˆ 14
Gross Jubilee oil production5 2026 c.60 midpoint c.60 midpoint c.60 midpoint
(kboepd)
2027-28 59 ˆ 50 59 ˆ 53 62 ˆ 55
2029-30 48 ˆ 42 54 ˆ 61 59 ˆ 71
2031-40 36 ˆ 15 56 ˆ 18 61 ˆ 17
Capital expenditure6 2026 200 200 200
($m)
2027-28 510 7 600 700
2029-30 35 385 575
2031-40 70 165 400
Decommissioning(5) 2026 25 25 25
($m)
2027-28 60 8 35 35
2029-30 50 65 65
2031-40 280 9 320 350
Pre-financing 2026 11 150-180 150-180 150-180
cash flow(5,10)
($m)
2027-28 220 270 210
2029-30 640 560 680
2031-40 910 1,900 2,750
Forward-Looking Statements
This document includes forward-looking statements. Whilst these
forward-looking statements are made in good faith, they are based upon the
information available to the Group at the date of this document and upon
current expectations, projections, market conditions and assumptions about
future events. These forward-looking statements are subject to risks,
uncertainties and assumptions about the Group and should be treated with an
appropriate degree of caution.
This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) No 596/2014 (as it forms part of UK domestic
law by virtue of the European Union (Withdrawal) Act 2018 as amended by virtue
of the Market Abuse (Amendment) (EU Exit) Regulations 2019). Upon publication
of this announcement, this inside information will be considered to be in the
public domain. The person responsible for arranging the release of this
announcement on behalf of Tullow is Adam Holland, Company Secretary.
This announcement is not intended to, and does not, constitute or form part of
any offer, invitation or the solicitation of an offer to purchase, subscribe
for or otherwise acquire, or to sell, transfer or otherwise dispose of, any
securities or the solicitation of any vote or approval in any jurisdiction,
whether pursuant to this announcement or otherwise.
The release, publication or distribution of this announcement in, into or from
jurisdictions outside the United Kingdom may be restricted by law and
therefore persons into whose possession this announcement comes should inform
themselves about, and observe, such restrictions. Any failure to comply with
the restrictions may constitute a violation of the securities law of any such
jurisdiction.
1 The key guidance metrics table contains certain forward-looking statements
that are subject to the usual risk factors and uncertainties associated with
the oil and gas exploration and production business. Whilst Tullow Oil plc
believes the expectations reflected herein to be reasonable in light of the
information available to them at this time, the actual outcome may be
materially different owing to factors beyond the control of it and its
subsidiaries (together, the ÒGroupÓ), or within the GroupÕs control where,
for example, the Group decides on a change of plan or strategy. The Group
undertakes no obligation to revise any such forward-looking statements to
reflect any changes in the GroupÕs expectations or any change in
circumstances, events or the GroupÕs plans and strategy. Accordingly, no
reliance may be placed on the figures contained in such forward-looking
statements. Nothing in the table should be deemed an admission of opinion of
any party or person as to the value of Tullow Oil plc or any of its
subsidiaries or of the Group as a whole, or of its or its subsidiariesÕ
assets.
2 Based on the Tullow 2P YE25 case.
3 Asset NPV (including Jubilee, TEN and contingent payments). The NPV
excludes cash, outstanding receivables and corporate costs. NPV sensitivities:
NPV15 @ $75/bbl - Tullow 2P $1.4 billion, Tullow BP $1.7 billion, Tullow
Upside $2.1 billion
NPV12 @ $75/bbl - Tullow 2P $1.6 billion, Tullow BP $2.0 billion, Tullow
Upside $2.4 billion
4 Production based on P90-P10 range in 2026 then reflects first to last year
production in following periods.
5 TullowÕs unit participation interest in Jubilee is 38.98%.
6 Capital expenditure, decommissioning and pre-financing cash flow reflects
cumulative spend in the relevant periods.
7 Includes TEN FPSO purchase cost in 2027.
8 Includes provisioning for TEN decommissioning costs from 2026 onwards.
9 Assumes Ghana Petroleum Agreements expire in 2040.
10 Pre-financing cash flow is defined as underlying operating cash flow
(after lease payments) plus net cash from/(used) in investing activities,
decommissioning expenditure and payments to decommissioning escrow funds;
assumes receipt of gas payments for the gas sold during the business plan
years.
11 Lower end of pre-financing cash flow range is based on P50 production and
upper end of the range includes one additional Jubilee cargo.
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