Tullow Oil share price little changed as group trims output guidance

Tullow Oil (LON:TLW) has trimmed its production guidance following the extended shut down at its flagship Jubilee field in late March and April, the Africa-focused explorer has said. The company further forecast a drop in first-half revenues as compared with last year.

Tullow Oil’s share price has slipped marginally into the red this morning, having inched 0.16 percent lower to 252.50p as of 08:40 BST, largely in line with a fall in the mid-cap FTSE 250 index which is currently 0.16 percent worse off at 15,977.71 points. The group’s shares have lost about a quarter of their value over the past year, but are up more than 50 percent in the year-to-date.
Tullow Oil announced in a statement this morning that its West Africa working interest oil production had averaged 1,900 barrels of oil per day (bopd), below the group’s previous guidance, on account of lower production from the Jubilee field in Ghana, following damage to the explorer’s production facilities. As a consequence, the company revised down its West Africa oil production guidance range to between 62,000 bopd and 68,000 bopd. Tullow, however, reassured investors that it had insurances in place, including an insurance which covers consequent loss of production and revenue from Jubilee.

The Africa-focused oil explorer further noted that it expects to deliver half-year revenues of $500 million, as compared with $800 million a year ago, while the group’s gross profit is expected to slip to $200 million in the first half of the year, from $300 million in the prior-year period.
In analyst news, Liberum Capital trimmed its rating on the stock to ‘sell’ yesterday, slashing its price target from 178p to 170p. Deutsche Bank meanwhile continues to see Tullow as a ‘hold’, valuing the shares at 270p.
As of 09:12 BST, Thursday, 30 June, Tullow Oil plc share price is 254.15p.