Thursday 22 March 2018

Newsmaker: Aidan Heavey

Aidan Heavey, Tullow Oil CEO
Aidan Heavey, Tullow Oil CEO

Aidan Heavey

Roscommon native Aidan Heavey will hope that 2016 is finally the year when Tullow Oil can get back on track.

Tullow takes its name from the Carlow town in which Heavey founded the company in 1985.

Married with two children, 62-year-old Heavey has been chief executive of Tullow since its inception and is one of the longest-serving Irish chief executives of a listed company.

He originally trained as an accountant with R J Kidney & Co before leaving in 1979 to join Aer Lingus as a financial controller.

He then worked at Tullow Engineering, before setting up what would go on to become one of the largest companies to come out of Ireland with his own money.

Heavey himself was always a corporate man rather than an oil baron at heart.

In an interview with the London 'Independent' in 2009, he said he had "no interest" in how you find oil and gas but is more focused on making sure that "everybody is happy and makes money out of it".

As he said himself: "I had never been to Africa and knew nothing about the oil industry, but business is business."

As it turned out Heavey is a canny businessman. After a long period of steady growth, Tullow began to expand more rapidly after the turn of the millennium, focusing more on assets in Africa rather than those closer to home in the North or Irish Seas, as many rivals were doing.

Through a series of canny acquisitions, Heavey built Tullow into a major international oil business. Perhaps one of his best deals was the $570m reverse takeover of Energy Africa in 2004.

Despite Tullow offering a 5pc discount to Energy Africa's market price, the Johannesburg-listed company accepted the deal with question marks over its production prospects. The deal gave Tullow a huge foothold in Africa and moved the firm to the next level.

By 2009, the London-listed oil explorer was one of the FTSE 100's top risers for five consecutive years and more than doubled its market capitalisation in 2008 alone.

However, times are much tougher nowadays as Tullow, like most of its rivals in the exploration sector, is struggling to cope with crashing oil prices.

After a brief rally last week following a bullish trading update, Tullow's shares closed down again on Friday at 130.2 pence, down by about 90pc since 2012.

It is also being pursued through the courts by Texas-based Hyperdynamics, which has accused it of breaching an agreement to drill a well at a project in Guinea.

With oil hovering around $30 a barrel and investors understandably spooked as markets worldwide are sliding, Tullow has perhaps not gotten the recognition its assets deserve.

Its TEN project in Ghana in particular, set to come on stream sometime in the summer, should boost value.

Tullow estimates it could help the firm produce as much as 100,000 barrels a day in West Africa by 2017, although it may not be the gold mine the company had hoped if oil prices continue to slip. With commodity prices showing little sign of picking up and investors nervous, Heavey will need his wits about him if he wants to spark a revival in Tullow's fortunes.

Irish Independent

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