UK-oil company, Tullow Oil Plc, will reduce its headcount in Kenya by about 40% as part of a company-wide restructuring following poor performances at its Africa and Guyana operations.

According to a Bloomberg article , about 35 of its workers in Kenya will become redundant, Tullow Kenya Managing Director Martin Mbogo said in an emailed response to questions, the article quoted. The reduced team “will focus” on achieving a final investment decision for the Kenya project this year, Mbogo said.

Tullow’s projects have been delayed in Kenya and Uganda, where the explorer is looking to reduce its stake in oil discoveries. Assets in Ghana performed poorly last year, and a Guyana crude oil deposit turned out to be smaller than expected.

Tullow said Feb. 5 that it expects its total workforce to shrink by a third and offices in Dublin and Cape Town to close as part of the restructuring. That would result in “considerable savings,” the company said.

Tullow, which has interests in two blocks offshore Guyana, took a $1.5 billion write-off due to a reduction in the Group’s long-term oil price assumption, disappointing drilling results in Guyana and the licence costs and write-down of value in other countries.

In a release issued last month, Tullow’s Executive Chair, Dorothy Thompson said that the company’s Board and Senior Management are nonetheless confident that the opportunities exist to improve operational performance, reduce our cost base, deliver sustainable free cash flow and reduce its debt.

“Tullow expects to report pre-tax impairments and exploration write-offs of c.$1.5 billion (c.$1.3 billion post tax) primarily due to a $10/bbl reduction in the Group’s long-term accounting oil price assumption to $65/bbl and a reduction in TEN 2P reserves,” the company stated.

“Exploration costs written off are predominately driven by a write-down of the value of the Kenya and Uganda assets due to a reduction in the Group’s long-term accounting oil-price assumption from $75/bbl to $65/bbl. The remaining write-offs include Jethro, Joe and Carapa well costs in Guyana as a result of drilling results and Kenya Block 12A, Mauritania C3, PEL37 Namibia and Jamaica licence costs due to the levels of planned future activity or licence exits.”

On Guyana’s end, earlier in January, the UK-based company made another oil discovery offshore Guyana at the Carapa – 1 well in the Kanuku Block but the find was below pre-drilled estimates.

The Carapa prospect was initially estimated as a 200-million-barrel cretaceous target but the well drilled encountered approximately four metres of “good quality oil”.
It marked the company’s third oil find in Guyana — after the Jethro-1 well and the Joe-1 well — but the company said that would plug the well and abandon it.