Tullow Oil has written off $800 million (KSh80 billion) of its explorations costs in Kenya, and Uganda due to a lower oil price forecast and a reduction in reserves.
Moreover, a trading update says the exploration costs written off are due to a reduction in the Group’s long-term accounting oil price assumption from $75/bbl to $65/bbl.
READ ALSO: Tullow Oil Shares Drop as CEO Resigns
Dorothy Thompson, Executive Chair, says Tullow ended 2019 with average production of 86700 barrels per day. In addition, Tullow expects to write off Kenya Block 12A.
Thompson expects total revenues for 2019 full year to hit $1.7 billion with gross profit expected to be $700 million.
Futhermore, Tullow has suspended the early oil pilot scheme (EOPS) due to severe damage to roads caused by adverse weather in the fourth quarter of 2019. Trucking remains on hold until all roads have repairs to a safe standard.
Recent reserves audits demonstrates a solid underlying reserves and resources base in West and East Africa. In addition, the 2019 Full Year Results will be released on 12 March 2020