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Highlights

 

  • Jefferies, Panmure Liberum, and Stifel Europe issued cautious ratings on Tullow Oil, with two “Sell” calls and one “Underperform” recommendation amid operational and financial challenges.

  • Tullow reported 1H25 production of 50.0 kboepd, down from 63.7 kboepd in the prior year, with revenue falling to USD 524 million.

  • Despite weaker results, Tullow expects full-year free cash flow of USD 300 million in 2025, supported by asset sales and debt reduction efforts.

 

Tullow Oil PLC (LSE:TLW.L) has received a mixed set of analyst ratings following the release of its Half Year Results for the six months ended 30 June 2025, . Analysts from Jefferies, Panmure Liberum, and Stifel Europe have each weighed in, issuing “underperform” and “sell” recommendations amid falling production, revenue declines, and a challenging oil price environment.

Analyst Ratings Overview

  • Mark Wilson, Jefferies — Underperform rating, price target AUD 0.29, representing a potential +40.14% upside from current levels. 

  • Ashley K. Kelty, Panmure Liberum — Sell rating, price target AUD 0.16, signalling a -21.92% downside risk. 

  • Christopher C. Wheaton, Stifel Europe — Sell rating, price target AUD 0.29, aligning closely with Jefferies’ valuation.

Half Year Financial Context

Tullow reported a 50.0 kboepd working interest oil and gas production for the first half of 2025, down from 63.7 kboepd in 1H24. Revenue fell sharply to USD 524 million from USD 759 million a year earlier, with a realised oil price of USD 69.0/bbl after hedging, compared to USD 77.7/bbl in the prior year. The group recorded a loss after tax of USD 61 million, reversing a USD 196 million profit in 1H24.

The results were influenced by the sale of the Gabonese business, lower output, and maintenance costs related to Jubilee operations. Free cash flow was negative USD 188 million, reflecting the timing of tax payments and capital spending commitments.

Strategic Moves and Outlook

Despite financial pressure, Tullow has advanced several strategic initiatives:

  • Asset sales — Completion of the Gabon sale for USD 300 million and a signed agreement for the Kenya business sale worth at least USD 120 million.

  • Licence extensions in Ghana — Potential to increase gas supply and boost reserves following agreements with the government.

  • Debt management — Repayment of a USD 150 million revolving credit facility using proceeds from asset disposals.

Looking ahead, Tullow expects 2025 production to average 40–45 kboepd, with full-year free cash flow guidance at USD 300 million, assuming oil at USD 65/bbl. The company’s year-end net debt target remains around USD 1.1 billion, with gearing of approximately 1.3x.