Executive Vice President of Tullow Ghana, Kweku Awotwi has disclosed that the company suffered a 30% reduction in revenue this year due to the company’s failure to meet its production target.
Addressing the media at a soirée organized by his outfit on Friday, Mr. Awotwi said that, “though we produced about 150 barrels this year, we predicted a lot more. If we forecast 170 and we got 150, effectively that is about a 30% reduction in revenue”.
“We are talking (about) $300 to $400 million and that is the kind of impact this kind of reduction has (caused). So, revenue is down about 30% and going forward, the company has to rethink its spending programme”.
He debunked any rumours that the company had been hit with financial challenges and assured that Tullow Ghana would bounce back to its feet.
“We haven’t missed any debt service payment. There is a good plan in place. We know what we are doing and we will deliver good results. Next year, we expect to generate about $150 million of free cash flow. We are not in financial crisis”, he asserted.
He also confirmed that the company is in deliberations with the Ghana National Petroleum Commission to increase its exportation of gas.
According to Tullow, the lower export of gas is due to a lack of demand from GNPC.
“The lack of demand is due to the Sankofa gas taking priority. If less Sankofa gas is offered and GNPC nominates more of Jubilee’s gas, the current plant capacity could max out”.
Tullow Oil Plc earlier announced the resignation of its Chief Executive Officer Paul McDade and also scrapped its dividends, as it continued to face issues at its main producing assets in Ghana.
The company faced problems at its operations in Tullow Ghana because of mechanical issues at the Jubilee field and a delay in completing a well at the TEN offshore field, which led Tullow to cut its estimates for 2019 oil output last month.
Source: Dickson Boadi