Tullow Oil Share Discussion Threads

[spacedust] 09/8/2015 15:34

Oil, here's hoping that the market sees it like that. Thanks for your input.

[oilretire] 09/8/2015 13:00

Space -

If it's commercially driven it's a catch 22 to avoid penalties:

Supplier (TLW) can't offer it to buyer until certain it can be supplied (i.e. compressor fixed)

Buyer (TICO) forced to buy a supply that is certain (i.e. crude) until alternative supply (of gas) can be guaranteed. There may well be a 'tie-in' notice period to interrupt that supply. Perhaps a few days, 1 week max would be my guess.

Supplier is now able to offer, so the buyer will nominate gas as soon as the oil nomination can be turned off.


If it's operational driven it might be catch 22 depending on the tests or the equipment being tested.

They selected light crude oil to perform this final commissioning tests - once testing ongoing they might be forced to continue for stability of the testing program or forced because they are not duel fuel burners on whatever they are commissioning.


It could of course be a combination of both.


But given they acknowledge the expense of crude over gas, TICO will switch ASAP.


Yes bad news in very short term, but I see it as very good news that Jubilee is fixed - and within the guidance of mid-August.

[azalea] 09/8/2015 12:31

spacedust
Since 1938, events in S.A. have moved on somewhat in its production of oil under the control of ARAMCO. So has S.A defence budget, spending billions of dollars on A/c, and high tech military equipment from the USA. Not forgetting the huge earlier Al Yamani project with BAE -tornado aircraft,associated weaponry, storage bunkers and HAS; the whole shooting match. The kingdom spends a lot of money on the keeping the families of princes happy, low taxes and little or nothing on indigenous industries, save gas & oil. S.A. current military expenditures in support of the Yemen government forces against rebel factions does not come cheap. In short, there is no way revenues from religious tourism could begin to make a dent on S.A. defence budget. S.A. is currently flooding the market with diesel fuel produced by its indigenous refinery, hence for the first time in 15 years diesel is cheaper than petrol in the UK and elsewhere, with prices set to fall further. The oil war is between the US shale producers and OPEC, led by Saudi Arabia.

[spacedust] 09/8/2015 11:39

According some energy experts, the decision not to take the gas, could affect crude oil production on the jubilee field. Tullow Oil may also be forced to flare the gas.

Being forced to do something is something I see as bad??? What am I missing.

[spacedust] 09/8/2015 11:37

The reason why I see as bad news is that tlw requested something and they got turned down

[spacedust] 09/8/2015 11:34

Either I need 300 to break even so I'm hoping you are right and we see an upside which we wil eventually. Any lower and I'll add

[spacedust] 09/8/2015 11:28

The first oil discovered in Saudi was in 1938 prior to that the country relied on pilgrims for centuries. From that perspective oil can vanish but eventually they wil be fine. Of course trips to France and lavishness would decline quite significantly for the elite buttons overall they wil be just fine as history proves - that's my evidence I don't have access to their papers

[spacedust] 09/8/2015 11:24

Oil, the Ramadan month accounts for 5-6% of the gap. The two weeks of the annual haj (I think that's how you spell it) accounts for another 5%. The rest of the year I'm not sure how much if gdp the pilgrims account for buy even if other remaining ten months accounted for an additional ten per cent then 20% of gdp coming from pilgrims is a substantial amount.

Also how many decades has it been since the Saudis relied on oil for their economy and how hiw many decades have they relied on pilgrims prior to producing a single barrel of oil???

[oilretire] 09/8/2015 10:56

Looks like Jubilee has been itching to get going for the last 4 days......

And confirmation of what I alluded too yesterday that commercially they had nominated to take crude. Likely to be a prescribed time frame in the agreement to turn that nomination down to zero.

But speaking to Joy Business, Managing Director of TICO, Nana Osafo Adjei says they were forced to do so because it is difficult to move to gas while running on crude oil.

“Even though light crude oil is relatively expensive our fuel supplier, the VRA, had not choice than to nominate light crude oil because at the time of the start of the commissioning process Ghana did not have adequate supply of natural gas.

“That is the only reason why over the last four days TICO with the support of VRA selected light crude oil to perform this final commissioning tests,” he added.

[azalea] 09/8/2015 08:36

spscedust-21689
What evidence do you have to support your claim that religious visitors to Saudi Arabia will support the economy at current levels even if the kingdom does not have "a single drop of oil left"?another drop of oil left?

[oilretire] 08/8/2015 09:46

And even if it takes a few days to sort out, it's still well within the expectation set in the half yearlies

However, the strong performance in first half 2015 has been offset by an unplanned technical issue that affected the gas compression system which has temporarily reduced oil production to approximately 65,000 bopd. This issue is expected to be resolved by mid-August.


Regardless, it's still POO that's in the driving seat for TLW share price in the short term I guess......

[oilretire] 08/8/2015 08:46

What's negative about it?

Happens all the time in the UK - commercially & operationally it's never just a simple 'flick of a switch' to change.

[spacedust] 08/8/2015 08:41

I see it as negative but I doubt this wil have any impact on the sp

[oilretire] 08/8/2015 08:18

Good news for Jubilee - ready to crank up the gas & therefore the oil production.

The article reads negatively initially though, but this happens all the time in these types of processes - it takes time to switch fuel type for the sake of stable operations. There'll probably be an element of 'commercial' delay too if they have agreed purchase of heavy fuel for the next day or two.....

It's actually very positive news.

[spacedust] 08/8/2015 08:05

Saudi Arabia will always be fine even if they don't have a single drop of oil left. The number of pilgrims and people around the world coming into the country for religious purposes are non stop 365 days a year round the clock 24 hours a day. this generates billions in income and is a guaranteed source of income regardless. The us have probably requested the Saudis not to decrease oil production to kill Russians for good. Why would Saudi not decrease production when they need oil to be above 100 $ like 99% of other oil producing companies. It's simple if oil stays at these levels all countries relying on oil for their economy wil go bust and bring the world to another recession. It just doesn't make sense. It's all controlled for one purpose only

[jovi1] 08/8/2015 00:46

OPEC and Saudi have underestimate shale resilience and will be them to loose the war, I believe.
What happen next for me is more of the same until year end maybe longer, then OPEC will cut production but this will only create a short relief as USA and other will increase production and erode Saudi market share.
What happen if they don't?
By mid next year they will be downgraded and at current expenditure will run out on money in approx 3 years.
In conclusion Saudi need oil at 102 to cover the shortfall in the budget but at that price level of rig will exceed 2000 in USA alone without counting Argentina and Brasil and any other form of drilling uneconomical at the moment but clearly viable at mid point.
It look like Saudi maybe need start to pay tax and produce something else or there economy will fall apart

[olieslim] 07/8/2015 17:30

dlku 7 Aug'15 - 08:49 - 21683 of 21686 0 0

bid soon imho

----------------------------
As soon as the Kenya results are known.
Those aren't far away.

Can they keep it here?
I don't think so.

Buy

[azalea] 07/8/2015 13:16

OPEC is reportedly in a battle with US and Canadian oil producers, which is resulting in falling oil prices.

[bootycall] 07/8/2015 09:58

I do not understand the logic of some of the posters on this board. From June 2016 onwards ,with Ten coming online and building up production, Tullow becomes massively cash flow positive, in all but the most ridiculous oil price scenarios. Tullow has very attractive cost recovery terms under its PSC which is why most people underestimate it's true cash flow. With a total production costs of circa $38 per barrel and with Ten online, a cash operating cost of nearer $9 per barrel, on operated production in Ghana, Tullow can farm out a sensible proportion of its licenses and transform its balance sheet. In my opinion, Jubilee's full field development plan and improved recovery factors should add circa 200 m barrels to reserves over the next 12-18 months which will give good cover to the reserve based lending ratios.
The conference call suggests Tullow has $1bn of headroom from revised lending facilities but the company will still have to undertake some form of portfolio management (farm out or reduce percentage interests in some fields) to manage with oil prices sub $50 per barrel. With 2 world class fields offshore West Africa ,this looks a reasonable proposition . The market may well take a more cynical view until debt is paid back, but seems to overlook the fact that even Africa Oil ( without production until 2020) managed to find a new $100m investor in Helios, despite being in an arguably weaker position. The faster the oil price goes down the quicker marginal production from high cost operators will shut down, allowing the forward pricing curve to recover. When Tullow can hedge production for future years at a half decent price, the short sellers will have to buy back quickly. Add to this the prospect of a pipeline announcement in Kenya in late August (and hopefully a finance package for its construction shortly afterwards ) and prospects for farming out East Africa will improve dramatically.
Tullows debt structure will make the conservative investor concerned, but 1 simple corporate transaction might transform the balance sheet. On the assumption that BP is planning exploration based on $60 per barrel oil prices and Total does not break even until $70 per barrel Tullow's production might be a very attractive as reserve replacement to the majors

In 9 months time, I believe shareholders will be breathing a huge sigh a relief.

Please do not make any investment decisions without doing your own research and do not rely on the accuracy of any of the above opinions.I own the shares,which I bought recently at a higher price.

[dlku] 07/8/2015 08:49

bid soon imho

[ny boy] 07/8/2015 08:23

Only the majors will survive, oil needs to get back above $50 fast or these kinds of stocks will continue to slide lower on dead cat bounces

[spacedust] 06/8/2015 18:13

It's not just oil companies that will go bust if oil stays below 50 $ for four years but many countries wil go bust. Oil will not stay at these levels simple.

[ny boy] 06/8/2015 16:29

Nasty bull trap on the recent dead cat bounce ouch for some!

[mr aboii] 06/8/2015 15:23

I insist of "happily" adding at 200 or lower