Government has extended petroleum agreements covering the country’s flagship offshore oil fields to 2040, securing a larger future state stake while introducing new gas payment safeguards in a move that recalibrates long-term fiscal returns from the sector.
Following parliament’s ratification, Tullow Oil plc said in a statement that the extension covers the West Cape Three Points and Deep Water Tano agreements which govern the Jubilee and TEN fields to December 31, 2040.
Under the revised terms, Ghana National Petroleum Corporation will increase its participating interest by an additional 10 percentage points from July 20, 2036, with joint venture partners diluted on a pro rata basis.
The structure gives Ghana a higher long-term equity position without immediate fiscal outlay, while providing the operator with tenure certainty over its core producing assets.
Alongside the licence extension, the parties agreed revised terms for Jubilee gas supply through 2040 at an escalating price of US$2.50 per mmbtu.
A gas payment security mechanism was also introduced and its terms were agreed for potential gas supply from the TEN field.
The mechanism is designed to address persistent delays in state-related receivables that have weighed on upstream cash flow.
Chief Executive Officer Ian Perks said in a statement that the ratification secures Tullow’s long-term operating position and supports continued investment in Jubilee and TEN.
He added that payment security provisions form part of a stable investment framework agreed with government and joint venture partners.
“The ratification of these agreements secures our long-term operating position, providing a runway for responsible resource development and a stable investment environment alongside the payment security for gas.
This is significant milestone that underpins Tullow’s long-term commitment to Ghana and allows for continued investment in its principal Jubilee and TEN assets. It is a result of excellent collaboration between the joint venture partners, including GNPC, and the government of Ghana,” the CEO said.
The extension comes as Tullow consolidates its portfolio around Ghana following asset sales in Gabon and Kenya.
In 2025, working interest production averaged about 40,400 barrels of oil equivalent per day – including roughly 7,100 barrels per day of gas, reflecting the disposal of Gabonese assets at start of the year.
Tullow Oil signs $205 million deal to acquire FPSO John Evans Atta Mills.
Gross production at Jubilee averaged about 60,900 barrels per day while TEN delivered roughly 16,000 barrels per day. Output was supported by strong well performance, including the J72-P well brought onstream in July, despite a planned 15-day shutdown at Jubilee in the first half.
Floating production, storage and offloading vessel uptime across both fields averaged 97 percent.
Financially, Tullow generated 2025 revenue of about US$847million at an average realised oil price of US$67.8 per barrel. Free cash flow was approximately US$100million, below earlier guidance.
The company attributed the shortfall primarily to lower oil prices in the year’s final months and delayed payments from the government of Ghana, as well as postponed proceeds from the Kenya asset disposal.
Receivables due from Ghana stood at about US$225million at year-end, including US$110million in gas payments, US$65million in cash calls and US$50million linked to TEN development debt.
Tullow said it is working with state agencies to resolve the balances.
Net debt declined to about US$1.35billion at the end of 2025, with liquidity headroom exceeding US$300million.
The company also extended its senior secured notes to November 2028 and its Glencore facility to May 2030 and agreed a new US$100million cargo pre-payment facility to strengthen short-term liquidity.
Reserves however fell sharply. Independently audited 2P reserves declined to 100.4 million barrels of oil equivalent from 164.5 million a year earlier, reflecting production, the sale of Gabon assets and downward revisions at Jubilee and TEN.
The company said remaining 2C resources of about 200 million barrels of oil equivalent present opportunities for maturation in Ghana through infill drilling, subsea pumps and potential monetisation of TEN gas.
The extension reinforces medium-term production visibility from the country’s two largest offshore fields while gradually expanding sovereign participation. The deferred increase in GNPC’s stake from 2036 signals a strategy of enhancing long-term resource capture without disrupting current investment flows.
Tullow forecast 2026 working interest production to average between 34,000 and 42,000 barrels per day, including about 6,000 barrels per day of gas.
Five Jubilee wells are scheduled to come onstream, including four producers and one water injector. Capital expenditure is forecast at about US$200million.
Pre-financing cash flow for 2026 is projected at US$150million to US$180million at US$65 per barrel, incorporating delayed Kenya proceeds and expected cash call receipts.
The company cautioned that cash flow will decline by roughly US$40million at US$60 per barrel and by a further US$20million at US$55 per barrel, underscoring sensitivity to price movements.
Auto dealers respond to 15% price cut announcement
