Tullow - comment

Tullow and Perenco have agreed to swap certain assets within Gabon for nil consideration and no impact on FY23 production. In essence, Tullow is reducing to zero its interest in four fields (Limande, Turin, Mona and Oba) all of which are operated by Perenco. In return, Tullow is increasing its stake in two fields, Tchatamba and DE8, to 40%. Note Tullow is not the operator in any of the fields in Gabon, and has only working interest participation. The aggregate value of the net pre-tax profit associated with the assets is c.$115m, as per Tullow’s Annual Report,

There isn’t sufficient information to appraise this deal, as Tullow does not disclose the production levels at individual fields. In addition, Tullow has acquired a larger stake in DE8, a field that is currently not producing. The expectation is DE8 field, currently undertaking appraisal drilling, may potentially be producing by the end of FY23. We rationale this transaction as Tullow concentrating its portfolio in Gabon.