Tullow profits jump by 143%

IRISH oil and gas exploration company Tullow saw pre-tax profits shoot up by 143% last year.

The company, which spent €1.5 billion on acquisitions and investments in 2004, said pre-tax profits rose to €87 million. Turnover and profits were boosted by the seven-month contribution of results from Energy Africa, which it bought for €455m last year. The soaring price of oil and gas also helped results.

Turnover for the year, which includes the contribution from Energy Africa, increased from €188m to €329m.

Shareholders have been rewarded with a 75% rise in the dividend to 1.75p for the year. And Tullow held out the prospect of further increases in the future.

The company said it produced 40,000 barrels of oil equivalent per day (boepd) last year, up from 30,000 the previous year. Just four years ago it from producing 2,500 boepd and the company hopes to increase output further this year.

About half of the company’s turnover is derived from its oil interest in Africa, which covers more than a dozen countries. The rest is from gas fields primarily in the North Sea. It also has projects in Eastern Europe and Asia.

Tullow said that it had sold off a number of non-core assets and this had raised €142m in cash and this would be used for further expansion.

However, shares were nearly 3.5% lower yesterday as some analysts said the results were below forecasts.

But chief executive Aidan Heavey was bullish about the company’s fortunes for the coming year.