DAVY VIEW

Tullow Oil’s last trading update for 2019 will make disheartening reading for shareholders. The group has reported that the oil discoveries made offshore Guyana consist of heavy and sulphur-rich oil. At the same time, there has also been a small pull back in the full year group production metric. Unfortunately, this clouds genuine progress in Kenya, further debt reduction and a restart to dividend payments. Production issues will be resolved and multiple light oil targets offshore Guyana remain, but for now a catalyst is required to demonstrate the upside in the investment theme.