UPDATE: Tullow Oil Makes Significant New Find Offshore Ghana

26th Jul 2010 07:47

(Adds analyst comment.) By James Herron Of DOW JONES NEWSWIRES LONDON (Dow Jones)--Tullow Oil PLC (TLW.LN) said Monday it has found a major new field offshore Ghana, potentially adding a billion barrels of oil equivalent to the resource estimate for the area. The Owo-1 well, close to the existing Tweneboa oil and gas discovery, "intersected a significant column of excellent quality light oil," Tullow said in a statement, adding that "results of drilling, wireline logs and samples of reservoir fluids have established Owo as a major new oil field requiring further appraisal." Tullow's exploration director Angus McCoss said: "Given this success, we are immediately drilling an appraisal sidetrack to further assess the size of this find. Accelerated appraisal drilling will now focus on maturing the resources in both Owo and the adjacent Tweneboa accumulation towards commercialisation." If Owo had not found oil, resources in the greater Tweneboa area would probably have been capped at 400 million barrels of oil equivalent, but the new find makes it more likely that the area contains around 1.4 billion barrels, said Panmure Gordon analyst Peter Hitchens. Owo is also potentially more valuable to Tullow than the estimated 1.5 billion barrels in its other major discovery offshore Ghana, Jubilee, because it has a larger stake in the field, he said. Tullow has a 49.95% interest in the block containing Owo and a stake of 22.896% in the block containing Jubilee. Following a two-year run of exploration success that saw its market capitalization almost triple, Tullow has stabilized and its shares are little changed over the last six months. This latest discovery may give new impetus to the company's shares, which closed Friday at 1,179 pence, giving the company a market value of about GBP10.46 billion. -By James Herron, Dow Jones Newswires; +44 (0)20 7842 9317; [email protected] (END) Dow Jones Newswires July 26, 2010 02:47 ET (06:47 GMT)