Tullow rallies on strong results as it eyes Kenyan oil discovery

SHARES in Tullow Oil soared yesterday, as it eyed commercial production in Kenya.

The FTSE 100-listed oil explorer, which reported its 2012 results yesterday, hailed a major basin-opening discovery in Kenya as one of its wells reported better-than-expected flow tests.

The African-focused explorer yesterday pledged $2bn (£1.3bn) of spending this year – up from $1bn last year – to drive exploration-led growth on more than 40 wells planned this year, in territories such as Kenya, Ethiopia and Norway among others.

Production-wise, it reaffirmed January’s guidance for 2013 at between 86,000 and 92,000 barrels of oil equivalent per day.

Operating profit rose five per cent to $1.18bn, while sales revenue edged up two per cent to $2.34bn, despite writing off $617m (£397m) for unsuccessful drilling last year.

Chief executive Aiden Heavey said that the company was focused on “exploration-led growth”, and that it would not join the “treadmill of production”.

Shares closed up 6.78 per cent.