Tullow Oil (LSE:TLW) has reported a strong start to 2026, with average group working interest production reaching 43.1 thousand barrels of oil equivalent per day between January and May. High operational reliability at the Jubilee and TEN floating production, storage and offloading (FPSO) vessels, where uptime exceeded 99%, has positioned the company to achieve output towards the top end of its full-year guidance range of 34,000 to 42,000 barrels of oil equivalent per day.
The company said its ongoing drilling programme in Ghana continues to progress as planned, with several new Jubilee wells scheduled to come online during the summer. Tullow has also secured regulatory approval for a further development phase that could include up to 20 additional wells, supporting future production growth and extending the long-term potential of its Ghanaian asset base.
On the financial side, the group reaffirmed its 2026 free cash flow guidance of $70 million to $175 million based on an oil price range of $70 to $100 per barrel. Management noted that free cash flow could increase to between $110 million and $230 million if an additional oil cargo is lifted during December. The company also benefited from stronger-than-expected realised prices, averaging approximately $96 per barrel before the impact of hedging.
Tullow said its hedging strategy continues to provide protection against downside commodity price movements while maintaining meaningful exposure to higher oil prices. With capital expenditure and decommissioning cost guidance unchanged, management believes the business remains well positioned to execute its growth plans in Ghana while generating value for shareholders.
Although operational performance remains strong, the company’s outlook continues to be influenced by financial challenges, including elevated leverage, negative equity and weaker free cash flow compared with 2025 levels. Technical indicators remain broadly supportive, with the shares trading above key moving averages and positive momentum signals in place, although some measures suggest the stock may be approaching overbought territory. Valuation remains difficult to assess given negative earnings and the absence of a dividend yield.
More about Tullow Oil
Tullow Oil is an independent energy company focused on the development and operation of oil and gas assets in Ghana. Listed on both the London and Ghana stock exchanges under the ticker TLW, the company’s core portfolio includes interests in the offshore Jubilee and TEN fields. Tullow remains one of the leading upstream operators in West Africa, with a strategy centred on responsible production, operational efficiency and long-term value creation.
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