Profits at Tullow Oil almost quadrupled last year as the group benefited from an increase in production and higher energy prices. The outlook remains very strong, finance director Tom Hickey said.
Current production is already exceeding the 58,450 barrels of oil equivalent per day (boepd) achieved last year - up 44 per cent on the previous year, and is forecast to reach 75,000 boepd by the end of 2006. Currently the company is producing about 69,000 boepd.
"The outlook is very positive," said Mr Hickey. "We see both gas and oil prices continuing to rise in the foreseeable future."
Profit before tax for the year came in at £178.6 million (€257 million), up from £46.8 million in 2004. Meanwhile revenue jumped to £445.2 million, from £225.3 million. The company attributed the significant increases to the combination of higher prices and increased volumes, as well as the contribution from acquisitions.
Tullow said it will pay a final dividend of 3 pence, bringing the total payment for the year to 4 pence, up from 1.75 pence in the prior year.
The company improved its position in the UK gas market, producing more than 200 million standard cubic feet per day (mmscfd) for the first time in December, helped by last year's acquisition of Schooner and Ketch. Hickey said he expects production to double again this year and levels are already exceeding 210 mmscfd following the recent completion of the Delilah well.
The UK now accounts for 50 per cent of the group's total production, up from 40 per cent last year. In 2005 Tullow invested £139 million in Africa and Hickey said the group is already seeing the benefits.
He also said it expects to make several new announcements within the next few months about developments in the region. African production now exceeds 34,000 boepd, a figure that's expected to increase over the coming year.
This year Tullow plans to spend £80 million drilling new wells and about £200 million developing existing wells and fields, according to Hickey. This compares with a combined spend of £190 million last year. It plans to drill at least 20 wells, including six in the UK and several in Uganda.
In London the shares slipped 0.25 pence, to 348.75 pence, while in Dublin they ended the day up 1 cent, at €5.06.
