FPSO Kwame Nkrumah - Jubilee field; Source Tullow Oil

Oil flows from first well offshore Ghana with three more to follow suit by year-end

UK-headquartered oil and gas company Tullow Oil has brought on stream the first of four wells on a field located offshore Ghana. The remaining three are expected to come online later this year.

FPSO Kwame Nkrumah - Jubilee field; Source Tullow Oil

Tullow announced the start-up of the Jubilee South East (JSE) project on Friday, 14 July 2023, explaining that the first well was put into production while a further two producers and one water injector would come online later during the year to help sustain gross Jubilee production over 100,000 bopd. The intention to drill these four wells was revealed in November 2022.

The company and its joint venture (JV) partners – Kosmos Energy, Ghana National Petroleum Corporation, Petro and Jubilee Oil Holdings – plan to maintain this increased level of production at Jubilee over the next few years through an ongoing infill drilling programme. 

Rahul Dhir, Chief Executive Officer of Tullow, commented: “Successful start-up at Jubilee South East is a significant milestone for Tullow and for Ghana and I would like to thank all those who have played a role in bringing this near-field Ghanaian development into production. Through our strong project management and operating capability, we have delivered a complex offshore development which is one of the key catalysts to unlock value for our business.

“We are well positioned for future growth with production ramping up in the second half of 2023 that will generate significant free cashflow. This marks the start of material deleveraging as we continue our transition into a low-debt business with the financial flexibility to pursue value accretive opportunities.”

Furthermore, multiple future drilling locations have been identified, thus the JV is focused on high-grading these opportunities to further extend the plateau and realise the full potential of the Jubilee resource base. The JV has invested around $1 billion over the last three years in the JSE project to drill wells and install the infrastructure needed to bring previously undeveloped reserves to production.

According to Tullow, the project used local suppliers and the majority of the offshore infrastructure has been fabricated by local companies in Ghana, with more than 90 per cent local workforce, demonstrating the evolution of the Ghanaian supplier base that can now support substantial elements of its oil and gas industry. A ceremony to celebrate the achievement of the first oil will be held in Ghana during the third quarter of 2023.

Dr Matthew Opoku Prempeh, Ghana’s Minister of Energy, remarked: “At the Ministry of Energy, we are delighted by this important milestone and wish to congratulate Tullow and the Jubilee partners who have contributed in diverse ways to this journey. The approval of the Greater Jubilee full field development plan by the Ministry in October 2017 paved the way for investment in the development of the JSE project, which has now culminated in the delivery of the first oil from the JSE area.”

The Jubilee field was discovered in 2007. In July 2009, the Minister of Energy approved the Phase 1 plan of development which included the use of an FPSO with a facility capacity of 120,000 bopd. The field came on stream in December 2010.

Petrofac was selected in July 2022 to provide operations, maintenance and technical support for the FPSO Kwame Nkrumah at Jubilee. On the other hand, Sparrows Group was picked to provide crane maintenance services onboard the FPSO under a two-year contract.

In a separate statement, Kosmos Energy confirmed the start-up of the Jubilee South East project and disclosed that the second well would come on stream later in July 2023. These two wells are expected to take Jubilee production to over 100,000 bopd gross while an additional production well and water injection well should further enhance production later this year.

Andrew G. Inglis, Kosmos’ Chairman and Chief Executive Officer, stated: “This is a significant milestone for Ghana and for the partnership, with growing production expected to drive higher revenues for the country and partners for years to come. Delivery of Jubilee South East is the first of three major growth projects for Kosmos.

“This catalyst represents the inflexion point of rising production and lower capital that we expect will flow through 2H23 into 2024. We believe Jubilee has the potential to deliver in excess of a billion barrels of oil equivalent gross, generating material value for the people of Ghana, the partnership and our investors.”