TULLOW Oil – which is just weeks away from a Ugandan tie up with Total and China’s CNOOC – saw its profits tumble last year.
In January, Tullow exercised an option over partner Heritage Oil’s Ugandan assets – Blocks 1 and 3A – and is planning to start exploration later in the year.
And now CNOOC and France’s Total are expected to buy a third of Tullow’s assets after a planned tie-up was confirmed by Tullow yesterday.
Both have made presentations to the Ugandan government over their proposed move into the region.
The government must give the seal of approval to Tullow’s Heritage deal as well as the new proposal before the companies can trigger their exploration plans.
A decision is expected by April according to officials.
Meanwhile, the FTSE 100-listed Tullow posted a 92 per cent drop in after tax
profit to £19m yesterday, compared to £226m in 2008, while sales revenue shed 16 per cent to £582m.
The group attributed the lower figures to a downturn in production volumes and commodity prices.
Chief executive Aidan Heavey said: “A strong performance in 2009 and an excellent start to 2010 has enabled the group to continue to create material exploration and development opportunities. Although our 2009 reported results still reflect a period of financial transition, first oil in Ghana from the Jubilee field later this year will result in considerable production growth and increased cash flow.”
Tullow is targeting a further 30 wells this year, mostly in West Africa and said it is poised for major production growth. Since Tullow was founded in 1985 by Heavey, it has grown greatly and the company employs more than 540 people in 23 countries.