Tullow Oil expects record revenues as output increases

  • @BawdenTom

Tullow Oil expects record revenues for the first half of 2012 on the back of a buoyant oil price and a rise in production.

The FTSE 100 company yesterday said it was on course to report sales of $1.15bn (£734m) in the six months to 30 June, compared with $1.06bn the year before.

Tullow's production during the period rose by 3 per cent to 77,400 barrels a day, as oil averaged at $114.20 a barrel and UK gas at 58.4p per therm – in line with the year earlier period. The bulk of production came from west and north Africa, where Ghana and Equatorial Guinea contributed 22,400 and 11,200 barrels a day respectively.

Tullow got a boost in February, when it signed two production-sharing agreements with Uganda that allowed it to complete a deal with China's Cnooc and France's Total that will pave the way for commercial oil production in the country.

That deal was struck after an intervention by the Foreign Secretary, William Hague, regarding a tax dispute between Tullow Oil and the Ugandan government relating to group's acquisition of assets in the country from Heritage Oil. Tullow has not yet begun oil production in Uganda.