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Tullow Oil Reports 2018 Oil Production Of 88,200 Bopd, In Line With View

Tullow Oil plc (TLW.L) reported that its West Africa oil assets performed solidly in 2018 and delivered net production of 88,200 bopd in line with expectations. It included production-equivalent insurance payments of 8,600 bopd from Tullow's Corporate Business Interruption insurance. Working interest gas production averaged 1,800 boepd for the full year resulting in overall Group net production of 90,000 boepd.

In 2019, overall working interest oil production, including production-equivalent insurance payments, is expected to average between 93,000 and 101,000 bopd. Working interest gas production exported from TEN is expected to average 1,000 boepd. Overall Group net production is therefore expected to be in the range of 94,000 to 102,000 boepd.

Solid production performance, sustained cost discipline and higher oil prices during periods of the year resulted in strong revenues and cash flow generation in 2018. With a realised post-hedge oil price of $68/barrel, Tullow expects full year total revenue to be $1.8 billion, excluding Corporate Business Interruption insurance proceeds of $0.2 billion.

For the full year 2018, the Group is expected to deliver strong free cash flow of $410 million. This includes the exceptional payment of approximately $200 million associated with the Seadrill litigation in July 2018 but excludes certain positive working capital items forecast for late 2018 which moved into early 2019. In addition, the receipt of $208 million of Uganda farm-down proceeds is now expected in the first half of 2019.

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