Despite news of a new oil formation discovered in Mauritania, the share price of Tullow Oil (TLW) drifted lower after it revealed a steep decline in full-year earnings. Tullow’s market value has fallen by nearly a third over the past 12 months due to a succession of exploration setbacks. Yet the prevailing negative sentiment needs to be set against the potential for a new oil play in East Africa, coupled with Tullow’s solid track record in project development.
In reality, Tullow recorded solid revenue and cash-flow growth, due to increased production from its flagship Jubilee field in Ghana. Despite a number of unplanned maintenance shutdowns through the second half, Tullow recorded a 6 per cent increase in overall net production to 84,200 barrels of oil equivalent per day (boepd).