Tullow Oil writes off $671m
Oil company under pressure after unsuccessful drilling operations.
Africa-focused oil company Tullow Oil took a $671 (€498) million writedown with its 2012 results against just $121 million a year earlier to account for unsuccessful drilling and the resulting reduction in the value of its assets.
Reporting 2012 profits that were little changed and within a range of analysts' forecasts, Tullow also reported drilling results which it said showed "the first potentially commercial flow rates achieved in Kenya" from its Twiga South-1 well.
Another keenly-watched prospect in its Kenya-Ethiopia portfolio, the Paipai-1 well, encountered "difficult hole conditions" Tullow said. It hopes to draw some conclusions on it by the end of February.
Tullow Oil has a record 49 wells planned this year, and has been under pressure to deliver some good drilling news after a disappointing trading update in January.
Although one of the industry's best performing drillers of recent times, Tullow had a mixed year in 2012. On the production side, it reaffirmed January's guidance for 2013 at 86,000-92,000 barrels of oil equivalent per day.