Tullow Oil Share Discussion Threads

[bigdazzler] 13/4/2016 16:57

swerves1 13 Apr'16 - 13:36 - 26484 of 26487 0 0

Damaging report that from Jeffries!




Yep swerves really damaging. Can we have some more damaging reports that send the share price up over 11% please.

[hearts1] 13/4/2016 16:06

Whatever NY boy goes short on always increases at a faster rate than its peers. Get him on the ENQ bb and it will double within a week.

[panic investor] 13/4/2016 15:17

gents, why is this up so much compared to ENQ etc ?

[swerves1] 13/4/2016 13:36

Damaging report that from Jeffries!

[brambuz80] 13/4/2016 12:39

EMA200 is a massive resistance from a TA point of view...last time it was tested was mid 2014.If the price breaks out from here and oil doesn't collapse we have a catalyst for a good run upward.

[onjohn] 13/4/2016 12:10

Poo. Stagnating.

[dlku] 13/4/2016 10:53

jeffries only target is 166p :(

JEFFRIES


Tullow Oil (TLW LN): Jubilee Turret Update - The Solution is a Major Project
Rating UNDERPERFORM
Price Target 166.00p
Price 193.40p
Bloomberg LSE: TLW LN


Key Takeaway
Speaking at length with Tullow management this morning clarified the timeline to a potential Jubilee Turret solution: 2-3 months to decide on 1 of 3 potential solutions then a further 9-12months to implement (either offshore or including taking the FPSO into dock). In the meantime, the new production off-take set-up will mean lower field rates.


The Jubilee FPSO turret bearing has been confirmed damaged (no longer able to rotate). Long-term remediation options are being evaluated with an initial view the issue “can be resolved”. In the meantime the vessels required to restart production offtake "are in place” (principally a dynamically-positioned shuttle tanker and a storage tanker for liftings) but c.2 weeks more are needed to safely implement production start-up (with additional time to ramp up).


Speaking to the company at length this morning (COO) the timeline for resolution is 2-3 months to decide on 1 of 3 engineering solutions and 9-12 months to implement the chosen one:


Replace the necessary parts of the Turret in-field to allow it to rotate once more. Essentially this would be fabricating and installing a new rotational ball-bearing race above the old one. One has to appreciate the size of these parts to understand the engineering this would require.
Convert the Jubilee FPSO to a “spread moored anchor set up” essentially by-passing the need to rotate around a Turret. Currently, 2 tug boats (and a 3rd on standby) are effectively doing this job - holding the FPSO on a fixed heading - because with the turret unable to rotate, any rotational movement of the FPSO (due to sea current/wind etc) places huge stresses on the Turret anchor chains. (we are available to explain in more detail).
Bring the FPSO into dock and replace the entire Turret. In our view, the apparent scale of the engineering involved would make this solution the most realistic (and safest) long term option.

These are all major projects in themselves but as ever with hardware issues we are confident the engineers will resolve the problem and crucially, it is not a reservoir problem. However, regardless of insurance recovery possibilities the Turret situation does impact asset value. For example, we find it hard to imagine the Jubilee Full Field Development plan will be sanctioned until the production facility (FPSO) is fully resolved. Ironically, we had already seen that sanction at risk of further delay simply due to TLW drive to reduce overall group capex.


Production guidance will be reissued once the new off-take procedures are confirmed as working (101kb/d Jubilee gross prior to shut-in TLW 35%, KOS US 24%, APC US 24%). With on-going RBL debt re-redetermination process (end April for news) and ND/EBITDAX reaching 6.5x by 1H16 on our numbers (before the turret issue), we see further risk to the shares despite the insurance claims already field. We recently Downgraded TLW to Underperform specifically due to news of this Turret issue adding to operational issues at Jubilee since First Oil at end-2010. Our Core NAV for TLW (mostly all Ghana value) is 115p/sh. To get to our target price of 166p a further 56p of East Africa "upside" is required.

[gersemi] 13/4/2016 10:47

Look at this go!!

[bigdazzler] 13/4/2016 10:45

Said it was time to go tullow!!!

[dlku] 13/4/2016 10:44

JEFFRIES


Tullow Oil (TLW LN): Jubilee Turret Update - The Solution is a Major Project
Rating UNDERPERFORM
Price Target 166.00p
Price 193.40p
Bloomberg LSE: TLW LN


Key Takeaway
Speaking at length with Tullow management this morning clarified the timeline to a potential Jubilee Turret solution: 2-3 months to decide on 1 of 3 potential solutions then a further 9-12months to implement (either offshore or including taking the FPSO into dock). In the meantime, the new production off-take set-up will mean lower field rates.


The Jubilee FPSO turret bearing has been confirmed damaged (no longer able to rotate). Long-term remediation options are being evaluated with an initial view the issue “can be resolved”. In the meantime the vessels required to restart production offtake "are in place” (principally a dynamically-positioned shuttle tanker and a storage tanker for liftings) but c.2 weeks more are needed to safely implement production start-up (with additional time to ramp up).


Speaking to the company at length this morning (COO) the timeline for resolution is 2-3 months to decide on 1 of 3 engineering solutions and 9-12 months to implement the chosen one:


Replace the necessary parts of the Turret in-field to allow it to rotate once more. Essentially this would be fabricating and installing a new rotational ball-bearing race above the old one. One has to appreciate the size of these parts to understand the engineering this would require.
Convert the Jubilee FPSO to a “spread moored anchor set up” essentially by-passing the need to rotate around a Turret. Currently, 2 tug boats (and a 3rd on standby) are effectively doing this job - holding the FPSO on a fixed heading - because with the turret unable to rotate, any rotational movement of the FPSO (due to sea current/wind etc) places huge stresses on the Turret anchor chains. (we are available to explain in more detail).
Bring the FPSO into dock and replace the entire Turret. In our view, the apparent scale of the engineering involved would make this solution the most realistic (and safest) long term option.

These are all major projects in themselves but as ever with hardware issues we are confident the engineers will resolve the problem and crucially, it is not a reservoir problem. However, regardless of insurance recovery possibilities the Turret situation does impact asset value. For example, we find it hard to imagine the Jubilee Full Field Development plan will be sanctioned until the production facility (FPSO) is fully resolved. Ironically, we had already seen that sanction at risk of further delay simply due to TLW drive to reduce overall group capex.


Production guidance will be reissued once the new off-take procedures are confirmed as working (101kb/d Jubilee gross prior to shut-in TLW 35%, KOS US 24%, APC US 24%). With on-going RBL debt re-redetermination process (end April for news) and ND/EBITDAX reaching 6.5x by 1H16 on our numbers (before the turret issue), we see further risk to the shares despite the insurance claims already field. We recently Downgraded TLW to Underperform specifically due to news of this Turret issue adding to operational issues at Jubilee since First Oil at end-2010. Our Core NAV for TLW (mostly all Ghana value) is 115p/sh. To get to our target price of 166p a further 56p of East Africa "upside" is required.

[dlku] 13/4/2016 10:37

just took £2000 on this ams trade. Cool. Holding original pos


Now for a bit of music

[leoneobull] 13/4/2016 10:36

Volumes can only mean shorters closing ahead of Doha?. I doubt banking news has leaked.

[wookie77] 13/4/2016 10:36

Taking out quite a few technicals!

[hearts1] 13/4/2016 10:32

Perhaps banking news will be with us soon. Get the EIA numbers out the way, hopefully a production drop, and all eyes on the weekend meet.If PoO can enter a new range of $45-50 then I would expect circa 350p with TEN coming to production.

[dlku] 13/4/2016 10:19

PMO looking ready to rumble

[nicebut] 13/4/2016 10:15

Seems to be attracting some proper money here. Nice move up

[rubberbullets] 13/4/2016 08:16

gimme gimme 250

[paulbiya] 13/4/2016 08:13

250 with bank agreements announced within two weeks IMOV

[rubberbullets] 13/4/2016 08:03

250p soon here i feel

[leoneobull] 13/4/2016 06:47

https://next.ft.com/content/fffc6e34-00a5-11e6-ac98-3c15a1aa2e62Read this very carefully ny boyWhoop whoop

[khanittag] 13/4/2016 06:30

Can't believe that the oil price is so strong now that it is knocking on the door of the $45-$50 range deemed fair value for oil by the Russians going into the meeting in DOHA. This poses increased risk of the meeting outcome falling short of expectation... is this looking potentially like a dangerous Bull trap?

[dlku] 12/4/2016 20:59

odey frying tonight

[nicebut] 12/4/2016 20:31

I think you could be right.