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West Africa-focused oil and gas producer Tullow Oil PLC on Wednesday said it swung to annual profit, though revenue fell on declining volumes.
Tullow shares were 9.0% lower at 56.62 pence each in London on Wednesday morning.
On the up, however, were realised oil prices, climbing to $62.7 a barrel in 2021, from $50.9 barrel in 2020. Geopolitical tensions have lifted oil prices further in 2022, suggesting Tullow's realised prices could see another bump this year.
In 2021, Tullow's revenue fell 8.8% to $1.27 billion from $1.40 billion. The company swung to a pretax profit of $203 million, from a $1.27 billion loss.
The profit swing was aided by exploration write-offs being almost completely wiped out to $60 million, from $987 million in 2020. The net hit from impairments of property, plant and equipment fell to $54 million from $251 million, meanwhile.
Despite the 23% rise in realised oil prices, Tullow's revenue fell. Sales volumes decreased by roughly a quarter to 55,450 barrels of oil equivalent per day.
Working interest production volumes fell 21% to 59,200 boepd.
For 2022, the output forecast remains at 55,000 to 61,000, as low as a 7.1% fall but as much as a 3.0% rise.
‘Tullow expects to secure a gas commercialisation agreement in Ghana which will come into effect once all foundation gas volumes have been delivered; this is forecast to occur before year-end,’ it added.
Tullow will re-enter London's FTSE 250 index later this month, following an index review. It was booted out of the mid-cap index back in September.
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