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Tullow Oil warns of more pressure on earnings; enters debt refinancing talks
StockMarketWire.com
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Oil producer Tullow Oil said it would report lower operating earnings for 2020, while forecasting another drop in output for 2021.
The company also said it had started discussions with its creditors with regards to its debt refinancing options.
Gross profit for the year through December was expected to drop to about $400 million, on revenue of about $1.4 billion, the company said.
Tullow Oil did not provide comparative figures. For 2019, it reported gross profit of $759 million and revenue of $1.68 billion.
The fall in earnings and sales came amid a drop in crude prices amid the pandemic and a fall in company production to 74,900 barrels of oil per day, down from 86,800 boepd in 2019, but in line with guidance.
Tullow Oil said pre-tax impairments and exploration write-offs for 2020 were expected to be broadly in line with the $1.4 billion reported in the first half.
Production in 2021 was set to drop to 60,000-to-66,000 bopd, reflecting a drilling hiatus in 2020, a planned shut-down in September on the Jubilee field and deferred development drilling on Simba in Gabon.
As part of the debt discussions, Tullow and its lending banks had agreed to extend the redetermination of a reserve base lending facility, which was due to complete in January, by up to one month.
'This will allow for additional time to review the business plan and operating strategy,' Tullow Oil said.
Story provided by StockMarketWire.com
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