Tullow Oil Plc on Dec. 9 said its CEO Paul McDade has resigned and the oil and gas explorer also scrapped its dividends, as it continues to face issues at its fields in Ghana.
Angus McCoss, Tullow Oil's exploration director, also resigned. Other leadership changes included the appointment of Dorothy Thompson as executive chair on a temporary basis and Mark MacFarlane, executive vice president of East Africa and nonoperated, as COO.
On Nov. 13, Tullow Oil had cut its outlook for production and cash flow because of persistent problems in Ghana, while revealing that the quality of oil recently discovered in Guyana was heavy in nature, sending its shares down more than 20%.
Commenting for the first time on the oil discovered in Jethro-1 and Joe-1 in the South American country, Tullow Oil said it was categorized as heavy crude, with high sulfur content, which would make developing it much harder than if it were medium or light crude.
This adds to the company's woes as it still faces problems at its operations in Ghana because of mechanical issues at the Jubilee Field and a delay in completing a well at the TEN offshore field. The issues have prompted a third production cut this year.
Analysts at Jefferies said the production downgrade was bad enough, although to some extent expected, but the additional news from South America about the crude quality made it worse.
The London-listed company now expects annual oil output to be 87,000 barrels per day (bbl/d) of oil, down from an earlier forecast of 89,000 to 93,000 bbl/d.
The company also slashed its 2020 annual production forecast. It expects to produce between 70,000 and 80,000 bbl/d next year, lower than its guidance for this year, Tullow Oil said.
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