By Dominic Hlordzi
There are indications that Tullow Oil may exit one of its West African oil fields as it seeks to boost cash flows.
The company is considering plans to sell its stake in the producing Espoir oilfield offshore Cote d’Ivoire.
What will be the effect of this development in the Petroleum Sector in Cote d’Ivoire and Ghana?
Tullow says its capital allocation strategy concentrates on the highest return-producing fields to maximise cash flow.
This means priority on returns and cash flow may compel it to quit the Cote d’Ivoire asset.
What will be the impact if this intention is implemented?
Dr. Yusiff Sulemana an Energy Analyst said, “if a major player like Tullow is pulling out from your neighbor’s waters or oilfield there is the potential that that could happen to you.”
He said the worry is if one looks at Ghana’s oilfields; there are three active fields, (Jubilee, TEN and the ENI fields) and Tullow operates two of the fields.
“If this development at the Ivorian field happens in Ghana where Tullow will be pulling out, that will be so dangerous for us,” he stated.
Dr. Sulemana said the development should encourage Ghana to strategize and be ready to take her offshore operations into her own hands should Tullow or other major players decide to pull out from the country.
“It is a wakeup call for us to revitalise our upstream portfolio to prepare ourselves to be able to take our destiny into our own hands,” Dr. Sulemana explains further.
The Energy analyst noted that Tullow’s presence in Ghana is not because it loves the country but because of a win-win mutual business interest and if at any point in time, the business plan changes it may pull out.
Reports of the possible exit emerged at the same time that BW Offshore said it had struck a $20 million deal to sell its Espoir Ivoirian floating, production, storage, and offloading vessel to operator Canadian Natural Resources.