Africa-focused Tullow Oil said today it expected to make $200m in free cashflow this year at an average oil price of $95 a barrel.
But the company added that it sees no cashflow in the first half after an arbitration payment and an acquisition.
Tullow said a shareholder prospectus for its planned merger with Capricorn Energy will likely be published in the fourth quarter, with a vote on the deal around the end of the year.
In 2021, with lower oil prices, Tullow had a free cashflow of around $245m, boosted by the sale of its Ugandan assets.
It is seeking an investor in its onshore oil project in Kenya, where a final investment decision is yet to be taken.
Tullow said today that it was confident it could make substantial progress in the second half of the year. It said it expects to produce between 59,000-65,000 barrels of oil equivalent per day this year.
Tullow has hedged 42,500 barrels per day (bpd) this year at an average floor and call prices of $51 and $78 a barrel and 33,100 bpd in 2023 and 11,300 bpd in 2024 at $55 and $75 a barrel.
Tullow Oil chief executive Rahul Dhir also said today that no tweaks to the planned all-share merger with Capricorn Energy were necessary, when asked about criticism about the deal as it stands from some Capricorn shareholders.
Dhir said Tullow was talking to shareholders of both companies, some of whom have overlapping holdings, ahead of the publication of a merger prospectus in the fourth quarter and shareholder voting towards the end of the year.
The boards of both companies have recommended shareholders approve the deal.
But some analysts and Capricorn investors, including Legal & General Investment Management, have said the deal gives an advantage to Tullow shareholders.
