Thanks to continued tensions in the Middle East, global oil prices have remained elevated for much of the year.

Long-Term Portfolio holding Tullow Oil (London: TLW) has been a major beneficiary of that trend, as first-half revenues rose to $1.3 billion and operating cash flow came in over $1 billion. Gross profit also rose by 13 percent to $764 million versus the same period last year. However, operating profit fell by 40 percent to $500 million, due to higher drilling and exploration costs and a tough comparable period last year.

During the first half of the year, the company drilled 13 exploration and 14 appraisal wells at a cost of $512 million, with an overall 63 percent success ratio with particular success in Kenya. Costs are likely to remain high through the rest of the year, with another 20 exploration wells expected to be drilled in the coming months.

Tullow’s production so far this year rose 14 percent to 88,600 barrels of oil equivalent per day (boepd), up from 77,400 boepd in the same period last year.

As a result of the company’s exploration and appraisal drilling program this year, resources of more than 250 million barrels of oil (mmbo) were confirmed in Tullow’s Ngamia-1 and Twiga South-1 fields in Kenya. The Kenyan Pmean basin is also now believed to hold more than 300 mmbo and the company’s Ugandan fields are expected to hold about 1.7 billion barrels.

In all, Tullow’s reserves and resources now total 635.2 million barrels of oil equivalent.

The first six months of 2013 also saw Tullow successfully sell off its Bangladesh assets for $42.4 million and deals are in the works for its North Sea and Dutch assets as well, allowing the company to focus on its African operations. A buyer is also being sought for Tullow’s Pakistan subsidiary.

With Tullow able to devote more investment to its African assets, production at its flagship Jubilee field in Ghana is up to 110,000 barrels of oil per day (bopd), although that is expected to decline to 95,000 bopd as maintenance is performed on equipment there.

Tullow has also received approval from the Ghanaian government to begin development of the Tweneboa, Enyenra and Ntomme fields off the country’s coast. The company expects to begin ramping up production in those fields, with the goal of hitting 80,000 bopd by 2016.

A seismic study of the fields is expected to be completed by the first quarter of next year and two water injection wells are already in place. In all, 24 development wells will be drilled in the fields over the next two years or so.

While Tullow’s financial results will likely remain volatile at least until 2016, it continues to boost production in Africa and should begin to show the effects of rising oil prices in the back half of the year. It should also shore up its balance sheet through strategic asset sales in countries such as Pakistan, providing more working capital and less leverage in the quarters and years to come.

Quickly advancing from a development stage company into a full-fledged producer, Tullow Oil continues to rate a buy up to GBp1,450.