Tullow Oil plc has, in a statement dated August 6, reported total group revenue of $524 million for the first half of 2025.

The revenue covering the period ending June 30 represents a significant drop from the $759 million recorded during the same period in 2024. Per the statement, this was due to the sale of the company’s Gabonese assets and reduced production volumes across its portfolio.

Excluding contributions from Gabon, revenue for the first half of 2025 stands at $411 million, compared to $666 million in the first half of 2024. The company reported an average oil price of $69.0 per barrel after hedging, down from $77.7 per barrel the previous year. Excluding Gabon, the price was slightly higher at $69.7 per barrel but still lower than the $77.0 per barrel in the prior year.

As a result, gross profit fell to $218 million (from $460 million in 2024) and further declined to $165 million when Gabon is excluded (from $387 million in 2024). Tullow reported a loss after tax of $61 million for the period, compared to a profit of $196 million in the same period last year. Without Gabon, the post-tax loss widened to $80 million, against a previous profit of $106 million.

The statement noted that Tullow’s average working interest production was 50,000 barrels of oil equivalent per day (kboepd) in the first half of 2025, down from 63.7 kboepd in 2024. Excluding Gabon, production dropped to 40.6 kboepd, compared to 53.5 kboepd last year.

The oil company recorded capital expenditure of $103 million (down from $157 million) and decommissioning spending of $13 million, an increase from $9 million. Free cash flow for the first half of the year stood at a negative $188 million. The company has attributed this to the timing of tax payments, lifting schedules, and Jubilee field maintenance.

Tullow's net debt position as of June 30, 2025, was $1.6 billion, slightly reduced from $1.7 billion a year earlier. However, the company’s cash gearing ratio increased to 1.9x net debt to EBITDAX, up from 1.4x in the previous year.

When adjusted for the sale of the Gabonese operations, the gearing rose to 2.1x. Liquidity headroom dropped significantly from $700 million to $200 million. Following the sale of its Gabonese subsidiary, Tullow used part of the $300 million proceeds to fully repay and cancel its $150 million Revolving Credit Facility (RCF).

Nonetheless, Tullow saw progress on its strategic priorities. On July 29, the company completed the sale of Tullow Oil Gabon SA for $300 million in net cash. Additionally, on July 21, Tullow entered a sale and purchase agreement for Tullow Kenya BV for a minimum cash consideration of $120 million, with two milestone payments totaling $80 million expected before the end of the year.

Richard Miller, Chief Financial Officer and Interim Chief Executive Officer, Tullow Oil plc remarked: “Our 2025 strategic priorities remain clear: refinancing our capital structure, optimising production, increasing reserves, and completing the sale of our Kenyan assets, having already realised $300 million proceeds from the sale of our portfolio of assets in Gabon.”

On June 4, Tullow signed a Memorandum of Understanding (MoU) with the Government of Ghana on June 4, which extends Tullow’s key production licences for the Jubilee and TEN fields to the year 2040. The MoU includes a commitment to ramp up gas supply to approximately 130 million standard cubic feet per day (mmscf/d) and introduces a guaranteed reimbursement mechanism for gas sales. These licence extensions are expected to significantly boost Tullow’s gross 2P reserves.

Also, an International Chamber of Commerce Tribunal ruled in January that Ghana’s Branch Profit Remittance Tax (BPRT) does not apply to Tullow Ghana, relieving the company from a potential $320 million tax liability. Tullow has also commenced drilling activities to reverse recent underperformance at the Jubilee field.

The first of two planned 2025 production wells, the J72-P well, was brought onstream at the end of July and delivered better-than-expected net pay. The company is using high-quality 4D seismic data acquired earlier in the year to improve its well planning models and will begin capturing an Ocean Bottom Node (OBN) seismic survey in the fourth quarter to further enhance reservoir understanding.

“In Ghana we have already taken actions to address the recent underperformance at Jubilee, with further optimisation potential identified. We have recommenced drilling and have successfully completed and brought onstream the first of two planned 2025 production wells at Jubilee, with better than expected net pay during drilling. The high quality 4D seismic data acquired at the start of the year is now being used to generate improved models that will directly inform the well-planning process and will be further supported with the capture of an Ocean Bottom Node (OBN) seismic survey in the fourth quarter this year,” Richard Miller, Chief Financial Officer and Interim Chief Executive Officer, Tullow Oil plc, remarked.

“We achieved a key milestone by signing an MoU in Ghana to extend our production licences for both Jubilee and TEN to 2040, which is expected to increase reserves and unlock significant value from these fields. In the second half of the year we are focused on refinancing our capital structure, production optimisation activities and continuing to optimise our cost base, which combined with the progress in the first half of the year, will help unlock Tullow’s intrinsic value,” he added.

Meanwhile, Tullow has targeted its full-year production to average between 40,000 and 45,000 boepd, including approximately 6,000 boepd of gas. Capital expenditure guidance for the year has been revised to $185 million, with decommissioning spend expected to total $20 million.

The company is also working to optimise its cost base, targeting $10 million in savings for 2025, which would reduce annual net general and administrative costs to around $40 million. A broader three-year cost-saving goal of $50 million is also in place.

Tullow has adjusted its free cash flow guidance for 2025 to $300 million, based on an oil price assumption of $65 per barrel. This projection includes $380 million in disposal proceeds, as well as $35 million in 2024 Gabonese taxes paid in 2025 and around $50 million in overdue gas payments from Ghana.

The company is maintaining its year-end net debt guidance of approximately $1.1 billion, with a target gearing ratio of 1.3x. Tullow says it remains committed to achieving net debt below $1 billion and gearing under 1x in the near future.