Africa’s focused oil and gas firm, Tullow, has planned to spend $265 million on capital expenditure (Capex) for 2021, down by $ 35 million compared to the $290 million expended in 2020.
It, however, wants to double its cost for decommissioning exercises by spending $100 this year compared to $50 million spent on decommissioned exercises in 2020.
Tullow expects to deliver a cash flow of $0.5 billion at $50/bbl for the first year of its new business plan which aims to deliver c.$7 billion under the operating cash flow over the next 10 years.
In a statement on Tuesday, January 27, 2021,Tullow said it has completed organisational restructuring and this, it said is expected to deliver sustainable annual cash savings of over $125 million.
The group’s working interest oil production averaged 74,900 bopd in 2020 with full year revenue expected to be $1.4 billion realised oil price of $50.8/bbl.
Tullow said the impact of COVID-19 was well managed effectively across the Group with negligible impact on production.
Commenting on the 2020 performance and 2021 outlook, CEO of Tullow, Rahur Dhir said, “Despite the challenges that 2020 presented, Tullow delivered production in line with expectations, executed major reductions to its cost-base and reduced net debt through the Uganda asset sale. Tullow has a busy year ahead as we begin implementing the business plan that we laid out at our Capital Markets Day. The plan is focused on ensuring that Tullow’s producing assets in West Africa reach their full potential. We will leverage the new plan and our reduced cost base to generate positive free cash flow at current commodity prices, drive down our net debt and deliver a robust balance sheet.”