31 July 2013, News Wires – UK’s Tullow Oil Plc says its latest drilling success at the Etuko-1 well in Kenya confirmed the commerciality of fields there and that combined with output from neighbour Uganda, a pipeline could deliver 500,000 barrels a day by 2018.
Tullow reported first-half 2013 net profit that fell to $313 million from $567 million. A Uganda project “farmdown” payment boosted earnings a year earlier and this was only partly offset by lower exploration writedowns in the 2013 half, Tullow said.
Tullow’s partner in Etuko-1 is Africa Oil. In a separate statement, it said Etuko-1 had been deepened and had encountered about 50 metres of potential net oil pay.
Tullow also confirmed it is to seek a “development carry” from any future partner in its Ten project in Ghana under which the new investor would pay development costs.
It put the increased cost of developing Ten at $4.9 billion, excluding lease costs for floating production, storage and offloading, FPSO, vessels.
Tullow has had some disappointing exploration results recently but house broker Morgan Stanley said the result was ahead of expectations and that the opening of a new province in East Africa and signs of capital discipline “should address investor concerns and help to drive the shares up”.