Tullow Oil Plc has posted a $61 million loss after tax for the first half of 2025, reversing a profit of $196 million from the same period in 2024. The setback comes amid falling oil prices, reduced production volumes, and mounting pressure on the company’s balance sheet.
Revenue plummeted 31% to $524 million, from $759 million a year earlier, as the average realized oil price dipped to $69.0 per barrel after hedging, compared to $77.7 in H1 2024. Gross profit also took a hit, sliding more than half to $218 million, down from $460 million.
Stripped of its now-sold Gabonese assets, the figures paint a starker picture: revenue was $411 million (down from $666 million), gross profit was $165 million, and the company booked an $80 million loss after tax compared to a $106 million profit in H1 2024.
Jubilee Woes, Strategic Recalibration
The British oil explorer attributed the downturn primarily to lower production, timing of liftings, and costs related to maintenance at its flagship Jubilee field in Ghana a key asset in its West African portfolio.
“In Ghana, we have already taken actions to address the recent underperformance at Jubilee, with further optimisation potential identified,” said Richard Miller, Tullow’s CFO and interim CEO.
Despite the gloomy headline figures, Miller highlighted early wins in production recovery.
“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.”
To support its operational reset, Tullow is deploying advanced 4D seismic technology and plans to launch an Ocean Bottom Node seismic survey in Q4 2025 to improve field mapping and recovery efficiency.
Free Cash Flow Still Negative, Gearing Up
The company’s free cash flow remained in the red at $(188) million, widening from the $(126) million outflow recorded a year ago. Capital expenditure dropped to $103 million (from $157 million), but decommissioning costs ticked up slightly to $13 million.
Tullow’s net debt stood at $1.6 billion by the end of June, a modest reduction from the $1.7 billion posted in June 2024. However, cash gearing rose to 1.9x net debt/EBITDAX, from 1.4x last year, and hit 2.1x when excluding the Gabon sale. Liquidity headroom also narrowed significantly to $200 million, down from $700 million a development that heightens the urgency for refinancing.
Ghana Remains Strategic Focus
Despite short-term challenges, Tullow is doubling down on its long-term play in Ghana, which remains the cornerstone of its growth ambitions. A key development during the period was the signing of a Memorandum of Understanding (MoU) with the Ghanaian government to extend production licences for both the Jubilee and TEN fields to 2040.
“This agreement is a significant milestone that increases recoverable reserves and unlocks additional value from our assets in Ghana,” Miller said.
Outlook: Tightrope Between Recovery and Risk
Tullow’s next phase hinges on refinancing its capital structure, production recovery, and continued cost discipline. Its recent $300 million Gabon asset sale is part of a broader portfolio rationalisation strategy aimed at focusing on core West African operations.
“In the second half of the year, we are focused on refinancing our capital structure, production optimisation activities, and continuing to streamline our cost base,” Miller reaffirmed.
As oil markets remain volatile and investor scrutiny sharpens, Tullow’s ability to execute on its Ghana strategy while managing liquidity and stabilising output may determine whether H2 2025 marks a turnaround or deepens its financial strain.
