Tullow Oil is investing a total of US$250 million in Ghana’s upstream petroleum sector this year.
The said capital investment is expected to largely focus on drilling and production efforts which would in turn increase Ghana’s installed oil and gas production.
This is part of concerted effort, policy direction and vision of the oil company with regards to investing in the sector following a re-organisation of the company’s structure which now makes Tullow Ghana Business a stand -alone business under the new Group structure.
The reorganization of the Group structure has seen the Managing Director of Tullow Ghana, Kweku Awotwi being promoted to the position of Executive Vice President of Tullow Oil plc.
According to the company, its long-term commitment is reflected in the Group’s investment on the two-rig drilling program – at the Jubilee and the Tweneboa, Enyenra, Ntomme (TEN) fields respectively, which has delivered good results.
This year, seven new wells have been planned for drilling activities by the company in the country’s upstream sector. Currently, the total capacity of Jubilee oil field stands at over 100, 000 barrels of oil per day (bopd) with over 250 million barrels of oil produced whereas the TEN oil field has total production capacity of over 80,000 bopd with over 50 million barrels of oil produced by February, 2019.
Speaking with the Goldstreet Business during a media engagement on the Company’s operations and updates on its activities, the Chief Executive Officer (CEO) of Tullow Oil, Mr. Paul McDade said the amount was an initial investment and thus more are expected to come in future years as the in-fill drilling campaign at both fields continue.
To increase local participation in its activities, the Company is targeting 70 percent Ghanaian employees in 2019.
Meanwhile, Tullow Oil is resuming the payment of dividend to its shareholders it stopped in 2014 with the Company’s board approving a minimum of US$100 million annually. Already, the Company has made payment of US$67 million in this regard and effective next year, it would carry out the approved new policy.
The resumption of the dividend pay outs follows a period of low oil price and reinvestment of income has worked significantly to strengthen the Company’s balance sheet.
It will be recalled that in November last year, the Company announced a capital returns policy to start from the 2019 financial year. The policy has it that the Group intends to pay an annual ordinary dividend based on its free cash flow generation, while ensuring an appropriate balance with debt reduction and investment in the business.
By Dundas Whigham