Interim Results 2007
Tullow Oil plc
Building a Balanced Portfolio of International
Exploration and Production Assets
Tullow Oil plc 2007 Interim Results
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Disclaimer
This presentation contains certain forward-looking statements that are subject to the usual risk factors and uncertainties associated with the oil and gas exploration and production business. Whilst Tullow believes the expectations reflected herein to be reasonable in light of the information available to them at this time, the actual outcome may be materially different owing to factors beyond the Groups control or within the Groups control where, for example, the Group decides on a change of plan or strategy. The Group undertakes no obligation to revise any such forward-looking statements to reflect any changes in the Groups expectations or any change in circumstances, events or the Groups plans and strategy. Accordingly no reliance may be placed on the figures contained in such forward looking statements.
Tullow Oil plc 2007 Interim Results
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Presentation Contents
Section
Introduction
Page
4
Finance
Production and Development Exploration
6
14 22
Conclusion and Q&A
Appendix 1 Strategy Appendix 2 Africa Appendix 3 Europe Appendix 4 South Asia Appendix 5 South America
38
40 43 50 54 59
Tullow Oil plc 2007 Interim Results
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Introduction
INTERIM RESULTS - 06
Tullow Oil plc 2007 Interim Results
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Transformation through exploration
Major step change in Tullows business
World class discovery in Ghana with billion barrel potential
Developments to more than double commercial reserves Strong team in place to deliver business expansion High-impact opportunities to continue growth Continuous active portfolio management
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Finance - Tom Hickey
INTERIM RESULTS - 06
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2007 Interim Results summary
1H 2007
Sales Revenue Operating profit before exploration activities Net profit Basic earnings per share Dividend per share Cash generated from operations1 Net debt2
1 2
1H 2006
310.7 m 178.5 m 95.4 m 14.72 p 2.00 p 245.7 m 80.1m
Change
- 8% - 30% - 62% - 65% No change - 18% + 542%
284.9 m 124.2 m 36.6 m 5.12 p 2.00 p 201.8 m 514.3 m
Before working capital movements Including all cash balances
Results principally impacted by weaker UK gas price
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2007 Interim Results Operational performance
Revenue down 8% to 285m
m
350
Production up 11% to 69,700 boepd*
Balanced revenue mix Oil 57%:Gas 43%
Realised oil price - $56.1/bbl (1H06: $54.4/bbl) Realised gas price - 36.9p/th (1H06: 53.3p/th) Hedging achieved >50% premium over average UK day ahead price
Revenue 311m
300
Revenue 285m
250
Operating Profit down 31% to 111m
200
Cash Operating Costs scope for 2H reduction
1H07 5.05/bbl (1H 2006: 4.85/bbl)
150
Depreciation charge influenced by Chinguetti,
Schooner/Ketch, oil price
100
1H07 6.27/bbl (2006: 6.13/bbl)
Other Costs
50
Admin Costs include 2.5m IFRS 2, 2.0m for
Hardman Resources office closure
0 1H2006
Gross Profit* Operating Cost
Exploration Write off 13.2m (2006 - 17m)
UK, Falklands, New Ventures
*Working interest basis
1H2007
DD&A Overlift
* Gross Profit before admin costs, exploration and disposals
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Cashflow, interest and hedging
Operating cashflow - 201.3m
m
600
175.5m reinvested in capital programmes Maintaining interim dividend at 2.0p/share
500
6.7m 363.5m
77.2m
334.9m
Interest charge - 23.2m (1H06: 9.4m)
Material net debt increase to 514.3m Incremental debt drawdown of 50m post Hardman bridge fees amortised over 18
months likely to extend bridge
total 5.5 million Hardman Resources acquisition completion
400
300
Amortisation of finance fees, abandonment 200
201.3m 175.5m
IAS 39 Hedging instruments
Oil and gas charge 15.3m mostly time
100
value Exchange loss 5.9m equal and opposite to 2006 gain, no cash impact
0 Cash Inflow
Operating Cashflow* Capex
* After working capital
Cash Outflow
Loan Drawdown Hardman acq Foreign Exchange Interest, tax & divi
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Hardman Resources acquisition
Deal completed 10 January 2007 Hardman business consolidated in Tullow financials for 1H07 65 million new Tullow shares issued to electing Hardman holders IFRS 3 Preliminary Fair Value Allocation exercise undertaken will be reviewed in 2H07
Fair Value Chinguetti Intangible Assets
m 79.2 640.7
Net Assets, including cash
Total1
1Including
39.5
759.4
Deferred tax Uplift of 164.3m
Integration of Hardman now completed
Perth office closed Uganda team increased Trinidad licences under negotiation
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Well funded capital programmes
Balance shifted due to larger appraisal
2007
415m
programmes and postponement of certain UK development programmes
2006
332m
2007 capital split 55:45 between
Development and Exploration
100
200
300
400
Capex acceleration driven by success in
Ghana and Uganda (together 28% of total 2007 capex, 58% of overall exploration expenditure)
Exploration
Development
2007 Forecast Capex by Core Area
415 million
1.9% (8.0) 3.4% (14.0) 10.8% (45.0)
NW Europe Other Africa Uganda Ghana South Asia South America
H2 appraisal and exploration results will
be key driver of 2008 programmes
32.5% (135.0)
16.9% (70.0)
34.5% (143.0)
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Investing in long term growth
Retain optimal stakes in high value assets
Uganda Block 2 dilution to fund development Kudu Potential additional farmout Ghana Largest equity holder
Ongoing portfolio analysis and management
Capital allocation 2008+
Match funding to asset lifecycles and characteristics
Project Finance Reserve based loans Longer term debt
Maintain financial flexibility to maximise asset values
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Financial summary
Underlying operating performance remains strong Hardman complete and fully integrated Effective Hedging policies generating and protecting value Major capital programmes driven by exploration success
Investment focus on higher value assets
Preparing the business and finances for the long term
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Production and Development Paul McDade
INTERIM RESULTS - 06
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2007 Highlights Exploration success will deliver next phase
Exploration
World class discovery in Ghana 7 out of 7 successful wells in Uganda Harrison continues CMS record of success Accelerated appraisal programmes
Production and Development
Significant production growth in Africa and Asia
Managing capital allocation to UK business Strong project delivery maintaining growth Recent exploration success could double reserves
Gearing up for major expansion
Preparing for step change in African operations Reorganising to ensure continued focus on:
Existing portfolio Ghana & Uganda projects
Future growth
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Near term potential to double Commercial Reserves
550 80,000
Production
500 70,000 450 60,000
1H 07 Average = 69,700 boepd (13 mmboe) Current = 75,000 boepd 2007 production forecast = 72-75,000 boepd
Reserves
400
350
50,000
Commercial Reserves 212 mmboe
boepd
mmboe
300 40,000 250 30,000
Limited mid year review 46% replacement
Contingent Resources 279 mmboe
Kingfisher near-wellbore (+27 mmboe) Kudu 20% divestment (-29 mmboe) Recent Ghana discoveries not included
200
150
20,000
100 10,000 50
Future
Ghana discovery alone has potential to double
reserves and production
2002
2003
2004
2005
2006
1H 07
Further upside potential from Uganda and
Kudu appraisal and exploration programmes
Reserves
Resources
Production
Substantial Resources upgrades expected at year-end
Tullow Oil plc 2007 Interim Results
Total Reserves and Resources = 491 mmboe
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Strong production growth from African oil interests
Strong production performance
1H production of 39,210 boepd Forecast to average 40,000 boepd for 2007
Key assets performing well
Gabon production stable at 14,000 bopd Ceiba and Okume performing above expectations West Espoir development ahead of schedule MBoundi development focused on water injection Mauritania redevelopment evaluation ongoing
Pipeline of developments
Gabon Ebouri development on schedule Gabon - low equity projects Onal, Oba, Obangue,
Tsiengui under way Cte dIvoire - Espoir FPSO Upgrade sanctioned Angola - Pit-Ban appraisal 2H08 Kudu first appraisal well underway Uganda early production system sanction Q407 Ghana appraisal focussed on early sanction
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Ghana Already planning for a major development
Well Results to date Conceptual Development Plan
Field Boundary
Discovery with billion barrel potential Light, 37 API, crude with favourable GOR High quality and productive reservoir sands
Fast-track appraisal under way
Tanker Oil Offloading
WIDC 5
Appraisal programme being fast-tracked Planned appraisal will deliver five wells and
WIDC 4 PDC 3
3D/4D seismic by early 2008 Additional rig slots being secured for 2008 2008 programme will focus on both discovery and surrounding potential
FPSO PDC 5
Development plans initiated
WIDC 1
Initial studies indicate large FPSO/subsea
development likely Year-end dataset sufficient to initiate formal conceptual studies
PDC 4
WIDC 3 PDC 2 PDC 1
Focus is on early sanction of the full field development
WIDC 2 PDC Production Drilling Centre WIDC Water Injection Drilling Centre
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Uganda Focus to deliver first oil 2009 and exploration upside
Drilling 2 active rigs
Currently drilling Kaiso-Tonya appraisal wells Heavy rig on site for Ngassa and Kingfisher Light rig tender under way for 2008 programme Offshore drilling targeted for 2H 2008
Kaiso-Tonya EPS first oil 2009
Appraisal drilling and 3D seismic under way Crude analysis complete Pre-FEED facilities, topping plant and power
studies complete and tenders issued Power transmission and road studies under way Project sanction 4Q 2007, first oil 2009
Oil Export Project planning ongoing
Initial scoping, refining and pipeline studies Preparations to launch full scale oil export
project upon further exploration success
Deliver first oil, inventorise basin initiate full scale export project
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Sustaining a strong gas business in a challenging market
UK market environment
Relatively weak gas prices Contractor environment remains tight Onerous tax regime for gas
Activity outlook to sustain production
Thurne onstream, Wissey on schedule and
Bure North awaiting approval
Kelvin first gas Dec 07 with K4 and Harrison
as potential satellites subject to approval
Infill potential; Hewett, Boulton, CMSIII Significant focus on managing operating costs Marginal programmes deferred with capital reallocated to high impact projects
Sustaining production with capital allocation limited to high graded projects
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Production and Development Summary
Strong delivery across production assets Pipeline of global development opportunities Recent success will deliver step change in reserves & production
Continued investment in developing our team will ensure focus on
Operational delivery from existing portfolio Ghana & Uganda projects Future growth
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Exploration Angus McCoss
INTERIM RESULTS - 06
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67% global exploration success rate in 2007 to date
UK 3 wells Ghana 2 wells Mahogany-1 Hyedua-1 Mauritania 568sqkm 3D Uganda 2 wells Nzizi-2 MPuta-3 Namibia 1 well 759km 2D, 326sqkm 3D 86km CSEM 69km CSEM Harrison Peveril Acer India
372km 2D
Suriname 5 wells Uitkijk-2 Uitkijk-3 Uitkijk-4 Uitkijk-1 Uitkijk-5 Falklands 4,000km 2D 550KM CSEM
Kudu-8 drilling
Tanzania 17km 2D
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Kudu-8 well to appraise multi-TCF potential close to completion
Kudu-8 well update
Gas encountered on prognosis in primary
objective
Log results to assess well productivity
expected late September
2-well appraisal programme
Development options to be reviewed
following the well results
Results could dramatically expand options
300/800 MW Gas to Power
Direct Gas Export
20% Kudu equity sold to Itochu
2 for 1 farm-in to appraisal wells Additional payments based on reserves
ultimately developed
Preferential funding terms for development Strategic partner with significant LNG
experience and funding capabilities
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Uganda - Leading position in the Lake Albert Rift Basin
Basin-wide strategy
Leverage knowledge and influence Swiftly test billion barrel basin potential Scaled development options
Hardman deal
Increases influence and materiality 100% and operatorship of Block 2
World-class basin potential
Seven wells : Seven successes First oil & gas flow tested in Uganda Highly productive reservoirs, 33 API
Challenges
Landlocked (1,300km from ocean) Establish reserves threshold for export Balancing long & short term goals
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Uganda - Preparing for commerciality in Block 2 (100%)
Kaiso-Tonya area
3D seismic expect complete end Nov 2007 Nzizi-2 & Mputa-3 drilled, Mputa-4 drilling Early production sanction expected in Q4 2007 First oil targeted for 2009
Butiaba area
2D seismic near completion, structures identified Light rig tender ongoing 3+ exploration wells being prepared for 2008
Exploration of large lake structures
Block 2 Ngassa & Lake 3D seismic (Kaiso Tonya) 1 Ngassa well (2007) Lake survey & rig tender Block 2 - Butiaba 2D Seismic (2007) 2-4 wells (2008)
Significantly de-risked by Kingfisher-1 Rig contracted to drill Ngassa-1 and Kingfisher-2
Ngassa-1 expected to spud in October 2007
Lake drilling solution for 2008 being evaluated
Block 2 Kaiso-Tonya 3D (500km2) seismic 3 onshore wells (2007) Early Production System
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Uganda Extending success into Blocks 1 & 3A (50%)
Block 1
Cooperation with Tullow operated seismic 2D seismic ongoing, structures identified Light rig tender ongoing 1-2 exploration wells being prepared for 2008
Block 1 2D Seismic (2007) 1-2 wells (2008)
Block 3A
3D seismic acquired over Kingfisher-1
discovery
Processing started and 3D interpretation
planned
Kingfisher-2 expected to spud in Q1 2008 Pelican planned for H2 2008
Block 3A 3D/2D Seismic Kingfisher-1 Well (2007) Kingfisher-2 well (2008)
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Kaiso Tonya geological models 200 MMbo upside potential
Mputa
Increasing understanding through appraisal Nzizi
Reservoir: distribution and quality Net Pay: upside in thin beds and weathered
basement Column Height: Definition of hydrocarbon contacts
Pre-appraisal model (35+ MMbo) Pre-appraisal model
More isolated volumes
Mputa Nzizi
No alluvial fans Isolated channels Shoreline deposits More wells required to develop field
Possible alternative model (100+ MMbo)
More connected volumes
Alluvial fans Channels extend to lakeshore No shoreline deposits Wells in good communication
Possible alternative model
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Butiaba: further upside potential in Block 2
Building 2008 Programme
Waki-1 (1938)
Up-dip potential Block-1 & 2 Synergies Coordinated seismic and drilling Rig tender closing Onshore & Nearshore Accessible prospects Benign terrain
Block 2 2D Seismic Acquired in 2007
Block 2 Infill Seismic Planned
Another Kaiso-Tonya? Tullow Interest 100%
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High Impact Lake Prospects: Ngassa & Kingfisher
2007 2008 Nearshore Programme
Well Trajectory
Nabors 221 Rig On-site for October spud Ngassa-1 90 day well Contingent testing
Ngassa risk reduction Nzizi-2 gas Mputa-3 sands Kingfisher reservoirs / seals
Shallow Secondary Objectives
Mid Secondary Objectives
First step towards realizing potential of
Lake Albert prospects
Lake-bed coring initiated for rig
tendering Drilling H2 2008
Deep Primary Objectives
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West Africa Transform Margin Exploration Campaign
Building the business
Exploration
First licence signed in 1996 Production from Espoir East and West Four CDI licences signed since 2004 Three Ghana licences added in 2006 Potential shallow water developments in Ghana
Mahogany discovery - June 2007 Hyedua discovery August 2007 North Tano appraisal - September 2007 Regional exploration and appraisal campaign 2008/9
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West Africa Transform Margin Plays
MAASTRICHTIAN
ALBIAN Espoir Baobab
CAMPANIAN SANTONIAN Mahogany Hyedua
Play fairway extends from Ghana to Cote dIvoire
First generation plays: Albian (Espoir / Baobab) Newly opened plays: Santonian (Mahogany / Hyedua) Frontier play potential: Campanian, Maastrichtian
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Ghana: World class discovery with further upside potential
June 07 announced Mahogany-1 discovery August 07 announced Hyedua-1 discovery
5.3 km southwest of Mahogany-1
Extends Mahogany accumulation into
Deepwater Tano in down dip location (~361m total gross column)
3 appraisal wells and 910 sq km HI-RES
seismic survey planned in 2007
Multiple follow-on prospects
Exposure to 1.0+ BBO
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Mahogany-Hyedua Accelerated Exploratory Appraisal
Objectives
Determine reservoir extent Appraise up-dip attic hydrocarbons Map potential below Campanian fans
Schedule
Mahogany-2 4Q 2007 Hyedua-2 4Q 2007 Mahogany-3 1Q 2008
Major reserve potential
P10: 1380 MMbo P50: 480 MMbo P90: 170 MMbo
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Exploration programme for next 12 months
Europe 4 wells
Mauritania 2 wells Cte dIvoire 1 well
Pakistan 2 wells Cameroon 2 wells India 3+ wells
Suriname 5+ wells
French Guiana 1 well Ghana 4+ wells Gabon 3 wells Namibia 2 wells Uganda 5+ wells Tanzania 1 well
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Exploration programme
Country UK EUROPE UK Netherlands Namibia Uganda Uganda Licence 44/19b SNS SNS Kudu Block 2 Block 3A Prospect Harrison 2 Prospects 2 Prospects Kudu East Mputa-4 & Ngassa Kingfisher Interest 22.50% 25%-50% 30%-60% 70% 100% 50% Gross Upside 20 mmbo 40 mmbo 40 mmbo 600 mmbo 800 mmbo 500 mmbo Date/Status Q3 2007 Q2 2008 Q3 2008 Q2/3 2007 Q3 2007 Q1 2008
Uganda
Uganda Gabon AFRICA Gabon Gabon Ghana Ghana/Cdl Cameroon Mauritania Tanzania India SOUTH ASIA Pakistan Pakistan Suriname SOUTH AMERICA Suriname French Guiana
Block 3A
Block 2 Nziembou Etame Azobe West Africa Transform West Africa Transform Ngosso Offshore Lindi CB-ON/1 Kohat Kohat Uitkijk Coronie Guyane Maritime
Pelican
Campaign MPano 2 Prospects 1 Prospect 4 Appraisal Targets Campaign 2 Prospects Campaign 1 Prospect Campaign Kohat East Kohat West Campaign (5+5) Campaign Matamata
50%
100% 40% 7.50% 60% 20-50% 20%-50% 40% 20-25% 50% 50% 50% 40% 40% 40% 77.50%
340 mmbo
475 mmbo 100 mmbo 60 mmbo 10 mmbo 800mmbo 1100 mmbo 30 mmbo 600 mmbo 200 mmbo 250 mmbo 50 mmbo 20 mmbo 25mmbo 300 mmbo 850 mmbo
H2 2008
Q3 2008 Q3 2007 Q2 2008 Q3 2008 Q3/Q4 2007 Q2-4 2008 Q4 2007 Q2 2008 Q2 2009 Q1 2008 Q4 2007 Q1 2008 Q3 2007 Q2 2008 Q3 2008
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Exploration conclusions
Exploration successes in Ghana and Uganda create step change for Tullow Focused exploration strategy continues to prove highly effective
Key skills Core geological plays Well understood regions
Rigorous portfolio management and prospect ranking Focused on growth through exploration - key component of a balanced strategy In 2007 will spend 190 million on worldwide exploration
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Conclusion
INTERIM RESULTS - 06
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Focused growth from a strong portfolio
Clear, simple, repeatable growth strategy Balanced portfolio High quality staff Strong cashflow and financial management Focus on what we know Long term plans and a long term view
Tullow is a flexible Exploration and Production business that can offer maximum value creation in changing market conditions
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Appendix 1 Strategy
INTERIM RESULTS - 06
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The Tullow Footprint
Europe ~28,000 boepd UK gas focus 62 blocks 20 producing fields Africa ~40,000 boepd 14 countries 53 licences 15 producing fields Asia ~5,000 boepd 3 countries 12 licences 3 producing fields South America 4 countries 12 licences
EUROPE
Netherlands Portugal United Kingdom E E EDP
AFRICA
Angola Cameroon Congo (Brazzaville) Congo (DRC) Cte dIvoire Eq. Guinea Gabon Ghana Madagascar Mauritania Namibia Senegal Tanzania Uganda E E DP E E E E E E E DP DP DP
DP D
E E ED
SOUTH ASIA
Bangladesh India Pakistan EDP E EDP
SOUTH AMERICA
Falkland Isl. French Guiana Suriname Trinidad & Tobago E E E E
E= Exploration
D=Development
P=Production
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Tullows long term growth strategy
PRODUCTION and DEVELOPMENT
A track record of production growth and asset enhancement 98% reserve replacement over the last three years Gearing up for a major expansion in African operations
EXPLORATION
Near-infrastructure and high impact exploration both delivering Long term growth key campaigns based on core plays and skills Continual rejuvenation of portfolio through new ventures
ACQUISITIONS and PORTFOLIO MANAGEMENT
A strong track record of deal identification, execution and integration Focus on value rather than production targets Consistently high-grading the portfolio
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Appendix 2 - Africa
INTERIM RESULTS - 06
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Africa: developing a truly pan-African business
A continent with many opportunities
Mature basins where majors are exiting
Significant areas currently unlicensed
A number of largely-unexplored basins
Strong knowledge base
Over 20 years of experience in Africa
Detailed understanding of African basins
Good access to a range of opportunities
Extensive portfolio
Interests in 14 countries, 54 licences and
15 producing fields
Major projects with billion barrel potential
in both Ghana and Uganda
Current production of over 40,000 boepd Continually evaluating new venture
opportunities
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North Africa: unique acreage position
Overview
Tullow has a material position in Mauritania 9 blocks in Mauritania/Senegal
Producing Chinguetti oil field Tiof and Tevet oil discoveries Banda and Pelican gas discoveries Significant exploration potential
Considerable long term exploration potential in
this underexplored region
Key operational highlights
1H 2007 gross production of 16,900bopd C-18 infill well on production in March 3D/4D seismic acquired in March Further infill wells planned for 2008 Development options for Tiof and Banda under review
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Stable production from Gabonese assets
Overview
Region where Tullow can apply its expertise in
revitalising mature assets
Interests in ~40% of all licensed acreage
12 producing fields 5 exploration licences Back-in rights to 10 additional licences
Key Operational Highlights
Production stabilised around 14,000 bopd Continued success from Niungo infill wells MPano exploration well in Q4 Avouma field on stream at 7,000 bopd Ebouri development due on stream in 2008 Recent acquisition added back-in rights to
3 Producing fields and 1 being developed 8 Exploration licences
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West Africa: material production growth in 2007
Equatorial Guinea
Okume
Drilling performance exceeding expectations Nine producers and six injectors drilled Production ahead of target ~40,000bopd 50,000bopd expected by year-end
Ceiba
Production enhanced by four new wells, 2
production and 2 injection
Production sustained above 40,000 bopd
Congo (Brazzaville)
MBoundi
Development focus on water injection Nine injection wells drilled to date Well management to reduce gas flow will
reduce near term oil production levels.
2007 expected to average 45,000 bopd
Angola
Block 1
Drilling and 3D seismic planned for 2008
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Kudu: developing upside opportunities
Kudu-8 well update
Gas encountered on prognosis in primary
objective
Log results to assess well productivity
expected late September
2-well appraisal programme
Development options to be reviewed
following the well results
Results could dramatically expand options
300/800 MW Gas to Power Direct Gas Export
20% Kudu equity sold to Itochu
2 for 1 farm-in to appraisal wells Additional payments based on reserves
ultimately developed
Preferential funding terms for development Strategic partner with significant LNG
experience and funding capabilities
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Tanzania and Madagascar: feeding the next campaigns
Madagascar Leads interpreted using existing 2D seismic
and new gravity / magnetic data oil discovery assessment
Tanzania 2D seismic acquisition in the Ruvuma Basin
ongoing
Prospective plays tied to Manandaza1 light Preparing for environmental impact Drilling planned for 2008/9
Tullow Oil plc 2007 Interim Results
Hydrocarbon systems: Msimbati / Mkindani oil
seeps & Mnazi Bay gas discovery
High risk and potentially high reward leads Drilling planned for 2008/9
49
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Appendix 3 Europe
INTERIM RESULTS - 06
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UK: Adding value in a challenging market
UK market environment
Relatively weak gas prices Contractor environment remains tight Onerous tax regime for gas
Activity outlook to sustain production
Thurne onstream, Wissey on schedule and
Bure North awaiting approval
Kelvin first gas Dec 07 with K4 and Harrison
as potential satellites subject to approval
Infill potential; Hewett, Boulton, CMSIII Significant focus on managing operating costs Marginal programmes deferred with capital reallocated to high impact projects
Focus on sustaining production with capital allocation limited to high graded projects
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Southern North Sea: adding value in a challenging market
CMS Area
Kelvin first gas Dec 07 K4 at development concept stage (sanction 4Q07) Harrison discovery on prognosis Nearby 2008 Cameron prospect de-risked
Tullow non-operated Tullow operated
Potential for joint area development
Infill opportunities (Murdoch, Boulton, CMS III) Follow-up development plans for S&K Extension of play into Netherlands (E13 : Epidote)
Thames-Hewett Area
CMS Area
Thurne on production @ 50 mmcfd 31 August 2007
Wissey under development - first gas 3Q08 Hewett Rotliegendes development well Q1 2008 Bure N proposed for sanction well expected Q1/208 Further opex reduction expected in 2008 from de-manning
Hewett facilities & further operating efficiencies
Hewett/Thames Area
Storage, LNG import and CCS projects actively studied for
beyond gas production phase on Hewett facilities
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Portugal: potential extension of Mauritanian play
Overview
3 blocks in Alentejo Basin awarded in 2007 Tullow 80%, with 2 local Portuguese partners Basin is undrilled, oil shows encountered in
wells in the onshore Lusitania Basin
Geological analogue to Mauritania Regional seismic data shows numerous leads
Key operational highlights
Regional seismic interpretation completed 2D seismic data reprocessing ongoing Detailed infill 2D seismic survey in 2008 Contingent 3D data acquisition in 2009 Earliest drilling 2010
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Appendix 4 South Asia
INTERIM RESULTS - 06
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South Asia: reinvesting for growth
A growth region for Tullow
Region of growing energy demand
Major high-impact exploration potential Relatively low-cost exploration/operations Limited competition for assets
Developments to fund exploration
5 exciting high impact exploration licences Development projects in Pakistan and
Bangladesh delivered with follow-on potential
Future growth
Focused on organic growth Extensive technical and geological knowledge
of South Asia
High Impact campaigns in India and Pakistan
in 2007/2008
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India: Six well campaign in proven rift basin
Exciting region with high impact potential
CB-ON/1 on trend between two proven basins Geologically analogous to Lake Albert Basin,
Uganda
Proven plays to north and south 2006 seismic has identified a number of
prospects
Prospect selection complete
Three firm wells followed by three contingent
wells to commence in Q1 2008
Existing infrastructure makes wide range of
prospects commercially viable
Strong local market for energy
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Bangladesh: production upside and high impact exploration
Overview
Current energy demand is significant Established gas pricing provides stability Prompt payments to date on gas sales
Key Operational Highlights
Block 9
Bangora delivering 70mmscfd Sanction of project to upgrade to 120mmscfd
imminent Exploration evaluation ongoing
Block 17/18
Total assumed operatorship Successful farmout and license extension secured Extensive 3D seismic planned for 2008
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Pakistan: considerable high impact upside potential
Overview
Five exploration blocks Security issues have delayed work
Key Operational Highlights
Production
Chachar came on stream in August Full production in September at ~25mmscfd Sara-Suri modestly increased through
compression
High Impact Exploration
Kohat seismic interpretation complete 2 wells planned First well expected to commence in Q4 2007
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Appendix 5 South America
INTERIM RESULTS - 06
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South America: Adding additional high impact acreage
Suriname
PSCs on Uitkijk and Coronie licences executed Uitkijk - up to 10 exploration wells this year Five drilled to date, hydrocarbons encountered Development potential being evaluated
French Guiana
Tullow operates large offshore licence 77.5% Preparing to drill substantial Matamata
prospect in 2008
Likely to seek a farm-in partner
Trinidad
Successful bidder for two key blocks Block 2a/b Guayaguayare Concluding negotiation on PSCs Exploration operations planned for 2008
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Tullow Oil plc
3rd Floor, Building 11 Chiswick Park, 566 Chiswick High Road London, W4 5YS Tel: +44 20 8996 1000 Fax+44 20 8994 5332
Investor Relations Contact Chris Perry: [email protected]
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