Trading & Operational Update

Tullow Oil PLC
10 February 2005


News release


Tullow Oil plc
10th February 2005


Tullow Oil plc Trading Statement and Operational Update


10th February 2005 - Tullow Oil plc (Tullow) issues this combined Trading
Statement in respect of its financial year to 31st December 2004 and Operational
Update. Tullow is a leading independent oil and gas, exploration and production
group, quoted on the London and Irish Stock Exchanges (symbol: TLW) and is a
member of the FTSE 250. The Group has interests in over 90 production and
exploration licences in 16 countries and is currently focusing on three core
areas: the UK North Sea, West Africa and South Asia.

The Trading Statement is in advance of the Group's Full Year Results, which are
scheduled for release on 12th April 2005.  The information contained herein has
not been audited and is subject to further review. The Operational Update
summarises key activities in Production, Development, Exploration and Appraisal
assets for the period from October 2004 to January 2005.


HIGHLIGHTS

2004 was a very exciting year for Tullow. Over one billion dollars was spent on
acquisitions and investments during the year and the Group also benefited from
the ongoing strength of global resource pricing.

Acquisitions
     
•    Energy Africa, acquired at a cost of US$570 million, has been successfully 
     integrated and consolidated with effect from 1st June 2004. There will be a 
     one-off charge in 2004 of approximately £2 million for post acquisition 
     reorganisation costs.

•    The acquisition of the Schooner and Ketch producing assets and surrounding 
     acreage for £200 million was announced on 20th December 2004.  A
     development team is now in place and the transaction is on schedule to 
     complete at the end of the first quarter, 2005.

Production and Reserves

•    Weighted average daily production for 2004 was 40,600 boepd, 62% ahead
     of 2003 levels.

•    In the 2nd half of 2004, Group working interest production increased to 
     51,800 boepd and continues to increase, averaging approximately 56,000 
     boepd in January 2005.

•    ERC Ltd will perform an independent reserves audit on Tullow's entire
     portfolio as at 31st December 2004.  The results of this will be disclosed 
     with the 2004 Full Year Results.

Development

•    In the UK, development drilling at Horne and Wren has been successfully 
     completed with both wells suspended for future production.  The results are 
     in line with pre-drill expectations and the project is on budget and on 
     schedule for first gas in the second quarter, 2005.

•    Tullow has issued an invitation to tender for the FEED study for the
     development of the Kudu field in Namibia to a selected list of 
     pre-qualified contractors and expects to award the contract at the end of 
     February 2005.

•    There has been significant development activity in the UK and West Africa 
     over the last four months with over 20 successful development and infill
     wells drilled.
     
Exploration and Appraisal
     
•    In Bangladesh the Bangora-1 exploration well tested gas at an aggregate 
     rate of 120 mmscfd gross.  Tullow, as operator, has proposed an appraisal 
     programme for 2005, which will include the tie-in of the discovery well 
     into existing infrastructure on a long-term production test.

•    A successful exploration well was drilled into the Akom North oil prospect 
     in Equatorial Guinea.  The well was suspended for potential future
     production as a satellite to the Okume complex (formerly known as Northern 
     Block G).

•    Based on current estimates the exploration write-off arising, along with 
     pre-licence and new venture costs, is anticipated to be in the order of £18
     million for 2004.

Operational Outlook

•    Group production in 2005 will be enhanced by the addition of further
     production in the UK from the Horne and Wren project, the Munro development 
     and the Schooner and Ketch acquisition. Some temporary reductions are 
     expected as a result of the current infill drilling programme on the Espoir 
     Field in Cote d'Ivoire.

•    During 2005 Tullow will actively participate in development activity in the 
     UK, Congo, Equatorial Guinea, Gabon, Namibia, Cote d'Ivoire and Pakistan.
     Planned expenditure is budgeted at approximately £75 million, with the 
     primary focus on the UK and West Africa.

•    In addition, Tullow has approved a total exploration budget of 
     approximately £40 million for 2005 with the objective of drilling at least 
     15 wells. Of those wells, a number remain subject to further technical 
     review and partner approval.


Conference Call

There will be a conference call at 09:30 (GMT) today, hosted by Aidan Heavey,
Chief Executive and Tom Hickey, Chief Financial Officer of Tullow Oil plc:

Please call [phone] and request to be connected to the Tullow Oil
teleconference.

A replay facility will be available from one hour after the conference call
until 18:00 (GMT) on Monday 14th February.  Please call [phone],
access code: 1558491#.

Commenting today, Aidan Heavey, Chief Executive of Tullow said:

'In the past year Tullow has experienced a step change in the scale of its
activities which has seen average production for the Group rise to a current
level of approximately 56,000 boepd.

The Schooner and Ketch acquisition, which is on schedule to complete in the
first quarter this year, will consolidate this position further. This
acquisition, the Energy Africa transaction, good progress in other areas of our
operations and favourable resource pricing combine to underpin an exciting year
for the Group.

Tullow enters 2005 a more focused organisation, with a balanced portfolio of
production and exploration interests and a solid cash flow. We look forward with
confidence and anticipate another year of growth and success.'

For further information contact:

 Tullow Oil plc           Citigate Dewe Rogerson          Murray Consultants
 ([phone])       ([phone])              ([phone])
 Aidan Heavey             Martin Jackson                  Joe Murray 
 Tom Hickey


Trading Statement

This trading statement is provided for the year ended 31st December 2004 in
advance of the Group's 2004 Full Year Results, which are scheduled for release
on 12th April 2005. The statement is part of the ongoing Investor Relations
programme and is produced in order to provide greater disclosure to investors
and potential investors. The information contained herein has not been audited
and is subject to further review.

Energy Africa Acquisition

The results of Energy Africa have been consolidated with effect from 1 June
2004. Pro-forma average production for 2004, assuming a full 12 month
contribution from Energy Africa, would have been approximately 51,300 boepd.
Tullow will record a one-off charge of approximately £2 million in 2004 in
connection with the termination of certain contracts and arrangements as a
result of post-acquisition reorganisation.

Production and Development Activities

Group working interest production for the 2nd half of 2004, including a full
contribution from the Energy Africa, averaged 51,800 boepd.  The weighted
average daily production for the year was 40,600 boepd, some 62% ahead of 2003
levels. Current working interest production amounts to approximately 55,700
boepd, reflecting successful and ongoing development activities. A further
breakdown of these figures is provided in the Operational Update under each core
area.  Production figures remain subject to final reconciliation and do not
equate to sales volumes. This is due to variations in lifting schedules and
because a portion of the production is delivered to host governments under terms
of Production Sharing Contracts.

Overlift position

At 31 December 2004, Tullow was in a net overlift position amounting to an
estimated 69,000 barrels.  This principally comprised overlifted volumes in
respect of the Alba field in the UK and Nkossa in the Republic of Congo, offset
by underlifted volumes in respect of the Tchatamba field in Gabon. Under UK
GAAP, such overlift positions are valued at market value for the relevant crude
and adjusted through cost of sales. Under normal circumstances an overlift
position would result in a debit to cost of sales, however due to the different
sales prices realised from the over and under lifted volumes (most notably Alba
which trades at a significant discount to Brent) a net credit of approximately
£1.7 million will be made to cost of sales in respect of the overlifted
position.

Capital Expenditure and Net Debt

During 2004 Tullow invested a total of £71 million in development and
exploration activities. Planned capital investment during 2005 is in the order
of £115 million, of which approximately 65% will be spent on development
activities in the UK, Congo, Cote d'Ivoire and Equatorial Guinea, with the
balance focused on exploration activities.

Net Debt at year end was £67.7 million inclusive of all cash balances, or some
£103.8 million excluding cash balances held in support of potential
decommissioning obligations.

Exploration Write-Off

Tullow operates a 'successful efforts' accounting policy in relation to its
exploration and development activities. Under this policy, all costs relating to
unsuccessful exploration activities are written off in full in the period during
which drilling activities were initiated.

During 2004, Tullow participated in successful exploration wells in the UK North
Sea, Gabon, Congo, Equatorial Guinea and Bangladesh. However a number of other
wells, in the UK, Egypt, Mauritania, Uganda, Cote d'Ivoire and Bangladesh were
not successful. Based on current estimates, Tullow's exploration write-off
arising from these unsuccessful activities, along with pre-licence and New
Venture costs, is expected to be in the order of £18 million.

This figure is subject to final reconciliation and does not include any
assumption in relation to the West Boulton well, currently in progress in the
Southern North Sea.

Operational Outlook

Group production in 2005 will be further enhanced by the addition of production
from the Horne/Wren and Munro developments in the Southern North Sea and the
anticipated completion of the Schooner/Ketch acquisition, currently scheduled
for the end of the first quarter. Some temporary reductions to Cote d'Ivoire
production are expected as a result of the current infill drilling programme at
the Espoir Field.

Tullow expects to drill at least 15 exploration wells in 2005.  Of these, a
number remain subject to further technical reviews and partner approval.  Wells
currently approved for the first half of 2005 are summarised in the following
table.  In addition to these, further exploration in 2005 is likely to include
wells in the UK, Gabon (Kiarsseny, Gryphon Marin and Akoum), Uganda and Pakistan
(Nawabshah).

Summary of Planned First Half 2005 Exploration Activity

Country              Licence         Prospect         Interest      Spud Date

UK                   43/25a          West Boulton     30%           In progress
Romania              EPI-3           Costisa-1        43%           In progress
Mauritania           Block 1         Petrel-1         20%           Q2 2005
UK                   44/23b          K3               22.5%         Q2/Q3 2005


Operational Update

This Operational Update summarises key activities in Production (P), Development
(D), Exploration (E) and Appraisal (A) assets of Tullow Oil plc for the period
beginning October 2004 and ending January 2005.

UK CORE AREA

In the North Sea, Tullow's principal interests are in the Caister-Murdoch System
(CMS), the Thames/Hewett group of licences and the Bacton onshore gas-processing
terminal on the Norfolk coast, which the Group operates.

Current working interest production      2004 Average boepd    January 05 Rate 
                                                               boepd

UK Southern North Sea (1)                17,264                16,465
UK Oil (2)                               3,259                 5,440
UK Total                                 20,523                21,905

(1) Includes all condensate and Gas sales

(2) Based on a seven month contribution from June 2004

Alba (P/D) (Tullow 8%)

Alba gross production averaged 64,000 bopd in January 2005. Current production
is approximately 70,000 bopd and further increases are expected with the
addition of a new well in early April.

Munro (D) (Tullow 15%)

Sanction for the development of the Munro field was received from all partners
in November 2004 and platform and pipeline construction has commenced.  The
project is on schedule for first gas in October 2005.


West Boulton 43/25a-2 (E) (Tullow 30%)

The West Boulton exploration well was spudded on 3rd December 2004.  Drilling
problems encountered during the 16' hole section have necessitated a mechanical
sidetrack.  The well is now expected to reach the reservoir target in early
March.

Horne and Wren project (D) (Tullow 50%)

Development drilling has been completed, with both wells, 53/3c-8 and 9,
successfully drilled and suspended in the reservoir interval.  The Noble Ronald
Hoope rig spudded the 53/3c-8 (Wren) well on 23rd October and completed
operations on the 53/3c-9 (Horne) well on 29th January.  The project remains on
schedule to deliver first gas in the second quarter, 2005.

Thames (P) (Tullow 67%)

The Thames third party field, Arthur, came onstream via the Thames Pipeline
System at the beginning of January.  Current production is approximately 90
mmscfd and is expected to increase to 110 mmscfd during the year. Based on these
rates, Tullow anticipates net incremental tariff revenues of the order of £6
million during 2005.

WEST AFRICA CORE AREA



In Africa, Tullow has production and development interests in Gabon, Cote
d'Ivoire, Congo (Brazzaville), Equatorial Guinea and Namibia. Tullow also has
exploration interests in Morocco, Mauritania, Senegal, Cameroon, Uganda and
Egypt.


Current working interest production      2004 Average boepd    January 05 Rate 
                                                               boepd

Congo Oil (2)                            2,314                 5,674
Cote d'Ivoire                            4,268                 3,600
Equatorial Guinea (2)                    3,203                 5,355
Gabon (2)                                9,374                 18,923
West Africa Total                        19,159                33,552

 (2) Based on a seven month contribution from June 2004


Republic of Congo

N'Kossa (P/D) (Tullow 4%)

In December, the first of three extended-reach wells targeting the southern
extension of the Nkossa field was completed and tied in and workover and
sidetrack operations have continued on existing wells.  The second extended
reach well is currently drilling and is expected to be completed during the
second quarter.  Since October 2004, average gross production has increased from
35,000 boepd to 46,000 boepd in January.

M'Boundi Field (P/D) (Tullow 11%)

The development drilling programme is continuing on the M'Boundi field with nine
successful producing wells drilled since October, eight of which have been tied
in.  Average gross field production has increased from 26,000 bopd to an average
in January of 35,000 bopd and is currently producing at 37,300 bopd.  Three rigs
are currently active on the field, with a minimum of 15 development wells
planned for 2005.  Should a fourth rig become available, a further 8 development
wells are planned.

Gabon

Tchatamba South (P/D) (Tullow 25%)

Two production wells have been successfully drilled and completed since October
increasing production by some 8,000 bopd gross.  Average production in January
was approximately 39,000 bopd gross.

Turnix (P/D) (Tullow 27.5%)

The TUM-B3 development well has been successfully drilled and completed proving
a western extension of the field.  The well was spudded on 28th November and
reached the reservoir target on 20th December.  The well was tied into the
production network and brought on stream on 29th January 2005.  It currently
produces in excess of 4,000 bopd gross, while total field production is in the
order of 8,000 bopd.

Niungo (P/D) (Tullow 40%)

Four development wells (NIU-16 to 19) were drilled successfully on time and on
budget over the last three months increasing gross production to a January
average of approximately 12,000 bopd.  The final well of the programme spudded
on 16th January and is due to complete this month.  Up to four additional wells
to develop the northern extension of the field have been approved and will
immediately follow the current programme.


Equatorial Guinea

Ceiba Field (P/D) (Tullow 14.25%)

Two infill production wells have been drilled successfully.  C-24 has been tied
into production and C-25 is expected on stream in February. A further five to
six wells are planned for 2005, two of which will be water injectors.  Average
gross field production in January was approximately 38,000 bopd.

Okume Complex (D) (Tullow 14.25%)

The Okume Complex comprises the Okume, Oveng, Ebano and Elon fields and was
formerly known as Northern Block G.  The development remains on budget and on
schedule for first oil in Q4 2006.  In November, a successful exploration well
into the Akom North prospect was drilled and suspended for potential future
production as a satellite to the Okume complex.

Cote d'Ivoire

Espoir Field (P/D) (Tullow 21.3%)

Current Espoir Production is approximately 18,000 boepd gross. A rig arrived on
site on 16th January to drill four new infill production wells with the
intention of significantly increasing daily production during the second half of
2005.  For the first half of 2005, Espoir production will be disrupted by the
drilling programme and average production will be reduced to approximately
14,000 boepd.

CI-26 (E) (Tullow 24%)

The Acajou-2X (Acajou North) exploration well commenced drilling on 23rd
November 2004 and encountered residual oil in the top Albian sands. The well was
then sidetracked to appraise the central fault block but encountered the Albian
sands below the oil-water contact.  The well was therefore plugged and abandoned
at the end of December.

Tullow is now working with its partners to assess the potential development
options in respect of the main Acajou discovery, with the most likely scheme
being a tie-back to the existing East Espoir facilities.

Namibia

Kudu (D)  (Tullow 90%)

Considerable progress has been made in recent months in relation to both the
technical definition and financing of the first phase of the Kudu field
development for a gas-to-power project.  A pre-FEED concept selection study has
been completed and two development options have been selected - a direct subsea
tie-back to shore and a subsea tie-back to a floating production facility. An
invitation to tender for the FEED study has been issued to a selected list of
pre-qualified contractors and a contract is expected to be awarded at the end of
February. A preliminary study in relation to the financing options for the
project has recently been completed by N M Rothschild, which will form the basis
for progressing critical commercial and financial agreements required to achieve
financial close in the next 12 months, in accordance with the project timetable.

Egypt

Matruh Onshore/Offshore (E) (Tullow 20%)

The Amethyst-1X exploration well intersected gas bearing sands in the Zahra
interval. However, the well failed to flow on test and was plugged and abandoned
in early December.

Mauritania

Block 2 (E) (Tullow 20%)

The Dorade-1 exploration well was plugged and abandoned in October.  The next
phase of the Licence has now been entered and partners are currently considering
future plans.

Block 1 (E) (Tullow 20%)

The exploration well into the potentially large Block 1 prospect, Petrel-1, is
now planned for Q2 2005.

Uganda

Block 3, Turaco-3 Well (E) (Tullow 50%)

The Turaco-3 well reached a total depth of 2,850m on 5th November 2004 having
intersected two potentially hydrocarbon bearing zones totalling 324 m of gross
pay (84m net pay). However, on testing, the upper zone of the well showed very
high concentrations of CO2.  As a consequence the well is unlikely to be
commercially viable. Tullow, in conjunction with its partners, is currently
finalising plans for further exploration in Uganda during 2005.  This is likely
to include at least one further exploration well.

SOUTH ASIA CORE AREA

In South Asia, Tullow has production and exploration interests in Pakistan and
exploration activities in India and Bangladesh.

Current working interest production     2004 Average boepd     January 05 Rate 
                                                               boepd

Pakistan                                884                    567
South Asia Total                        884                    567


Bangladesh

Block 9, Bangora-1 (E/A) (Tullow 30%)

In November, the Bangora-1 exploration well tested gas at an aggregate rate of
120 mmscfd gross from two zones.  A further three shallower zones will be tested
during appraisal drilling.  Tullow, as operator, has proposed an appraisal
programme for 2005, comprising both 2D and 3D seismic, the tie-in of the Bangora
discovery well to existing infrastructure for a long term production test and
two appraisal wells.

Pakistan

Chachar (D) (Tullow 75%)

Approval has been received from the Government of Pakistan for the development
of the Chachar Field and Tullow plans to commence operations later this year.

Sara and Suri (P) (Tullow 38.18%)

Options for further drilling on the Sara and Suri gas fields are being
considered

Nawabshah (E) (Tullow 30%)
A 2D and 3D seismic acquisition programme is nearing completion on the Nawabshah
exploration block.

                                      ENDS

Glossary

bopd - barrels of oil per day
boepd - barrels of oil equivalent per day (a measure of oil plus gas production)
FEED - Front End Engineering Design
mmscfd - million standard cubic feet per day


Disclaimer

This announcement contains certain operational and financial information in
relation to 2004, which is subject to final review and has not been audited.
Furthermore it contains certain forward-looking statements that are subject to
the usual risk factors and uncertainties associated with the oil & gas
exploration and production business. Whilst the Group believes the expectations
reflected herein to be reasonable, the actual outcome may be materially
different owing to factors either within or beyond the Group's control, and
accordingly no reliance may be placed on the figures contained in such forward
looking statements.


For further information on the Group see www.tullowoil.com



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