Tullow Oil Share Discussion Threads

[wodahsnoom] 03/12/2024 10:11

Your thesis is very concise. What evidence do you have that Jubilee production will drop "dramatically"? Hedges are in place to mitigate if poo stays low or goes lower. Renegotiation of debt for any O & G company won't be easy. "This" has been around for 4 years (poorly researched thesis).

[hsfinch] 03/12/2024 07:24

Interesting. My thesis here is that Jubilee production is gonna drop dramatically. And poo will stay low. And renegotiation of debt package won't be easy. Now this.

[up just a little bit] 02/12/2024 15:20

Interesting article. Thanks for the link, hopefully as it says already priced in should it go against TLW. Should it be in favour then a nice tick up but will have to get in quick.

[alfiex] 02/12/2024 14:18

https://www.proactiveinvestors.co.uk/companies/news/1061892/tullow-oil-for-ghana-read-godot-us-investment-bank-says-of-long-running-tax-saga-1061892.html

[alfiex] 02/12/2024 14:18

Looks like court case could hit us with 70% chance of us losing

[subsurface] 02/12/2024 13:36

Thanks for all your post XX much appreciated.

Comment from Springfeild CEO


Afina-1x is a vertical well, we are confident that a horizontal well or other well completion options that maximise reservoir exposure in the fields would deliver much higher production rates.

Perhaps an interesting thought for Tullows next drilling plans?

[alfiex] 02/12/2024 13:19

Not like tullow to relinquish valuable acreage! LOL, time for management changes perhaps

[xxnjr] 02/12/2024 12:35

Slightly off topic. Springfield have completed a successful DST on their Ghana well. Not 100% sure, but pretty sure, this used to be a TLW discovery in an area that was subsequently relinquished by TLW. Anyway the release is quite interesting



"Pressure transient analysis also indicates reservoir pressure depletion at the reservoir level as compared to 2019 pressures indicating depletion through production."

The implication being, I presume, that Afina and ENI's Sankofa field are one of the same thing and should be unitised. You will recall that Springfield and Ghana.gov lost their arbitration against ENI recently, as the former hadn't demonstrated evidence of communication between the 2 fields. I guess there may be another potential claim on ENI? And if so, this seems another opportunity lost due to incompetence at Tullow. Albeit during the pre-Rahal era.

Incidentally the Deepsea Bollsta rig is now going to Namibia to drill Chevron's well. Which we all know is a highly prospective block given away by Rahul for nought.

[kulvinder] 02/12/2024 07:18

Sorry meant to say hsfinch...

[kulvinder] 02/12/2024 07:18

Fsfinch, you are probably right....not much to see here at the moment.

[hsfinch] 30/11/2024 13:20

You will need WW3 to break out and push oil over 150 bucks to see 60p here.

[xxnjr] 29/11/2024 18:47

Non-expert. My tuppence worth.


Seems like an investment in something they feel is undervalued.


who schedule A p13, schedule B P14 of an SEC document I've downloaded (but system prevents me copying a link to!!!) seem to be owned by Sanlam, a large S.Afr financial services group.



At least someone thinks Tullow is undervalued!

[waldron] 28/11/2024 13:03

Tullow Oil shares dive after energy group cuts free cash flow expectations

Tullow expects to achieve between $150m and $200m in free cash flow this year

Its shares were among the FTSE All-Share Index's biggest fallers on Thursday

By HARRY WISE

THE DAILY MAIL

Updated: 11:55 GMT, 28 November 2024



Tullow Oil shares plunged on Thursday morning after the energy firm reduced its free cash flow forecast.

The West Africa-focused energy producer now expects to achieve between $150million and $200million in free cash flow this year, compared to previous guidance of $200million to $300million due to payment delays.

It now anticipates incremental payments from its Jubilee field to arrive in January 2025, while Ghana's government currently owes around $40million in overdue gas payments to the firm.

The London-based company's shares slumped by 9.4 per cent to 20.7p just after 11am, making them the FTSE All-Share Index's second-biggest faller behind Ithaca Energy.

Tullow further revealed that oil production at the Jubilee field in Ghana averaged around 89,000 barrels of oil equivalent per day (boepd) up to the end of October, which was below forecasts.

It said this was caused by the underperformance of a well, power cuts hitting water injection levels, and 'unplanned downtime' at an onshore gas processing plant.

Forecast: West Africa-focused energy producer Tullow Oil now expects to achieve between $150million and $200million in free cash flow this year

By comparison, oil production surpassed expectations at its TEN development, totalling about 19,000 boepd.

In addition, the group said non-operated production was set to average about 10,500 barrels per day in 2024, which is in line with predictions.



Rahul Dhir, chief executive of Tullow, said: 'Our cash-generative business enables us to continue our deleveraging progress.

'This has been achieved despite underperformance at the Jubilee field, which has been offset in part by strong performance at TEN.'

He added: 'We are well positioned to optimise our capital structure and look forward to progressing plans to address our remaining debt maturities.'

Tullow expects its net debt to equal about $1.4billion at the end of 2024, meaning it will have halved over the past five years.

The company has partly accomplished this by cutting capital expenditure, selling assets in Gabon and Equatorial Guinea, and offloading a stake in some Ugandan onshore oil fields.

Its finances have also benefited from a surge in oil prices caused by loosening pandemic-related travel restrictions, OPEC+ countries limiting production output, and Russia's full-scale invasion of Ukraine.

Under its current strategy, the group aims to have less than $1billion in net debt by 2025 and cash gearing below 1x in the near term.

[ashkv] 28/11/2024 12:34

Tullow is teetering - Ghana being tardy with gas payments is out of the blue and material to debt refinancing prospects / going concern for Tullow!!!

"The final position within the revised range for 2024 will depend on realised prices of four cargos yet to price, progress on receipt of the overdue gas payments from the Government of Ghana (currently c.$40 million outstanding) and working capital movements."

Tax Arbitration -> Not worth the risk to be in Tullow prior to the outcome of the below. It is expected that Tullow should prevail in court - however, if the outcome is not as expected TLW equity goes to ZERO!!!

"The outcome of the arbitration in respect of the Ghana Branch Profits Remittance Tax assessment is now expected by the end of the year."



Share Price -> 20.50p
TLW share price vs 52 Week low of 20p on 13 Nov 24 -> 2.50%
TLW share price vs 52 Week High of 40.32p on 31 May 24 -> 96.68%
Brent Price -> $73.30
Outstanding Shares -> 1,458,470,214
Market Cap GBP -> £298,986,394
GBPUSD -> 1.2675
Market Cap USD -> $378,965,254
Net Debt USD (Per Nov 24 Trading Update Forecast YE 2024) -> $1,400,000,000
TLW Q1-Q3 2024 Avg Production [Excluding 6.5kboepd of Gas] -> 55,500
TLW 2024 Low-Guidance Excluding 7kboepd gas [Revised Per Q1 Trading Update - May 2024] -> 55,000
TLW 2023 Avg Production (Excluding 6kboepd Gas) -> 57,000
TLW 2022 Avg Production -> 61,100
Enterprise Value (USD) -> $1,778,965,254
EV/BARREL-USD Q1-Q3 Avg 2024 Production [Excluding 6.5kboepd of Gas] -> $32,053
EV/BARREL-USD 2024 Low Guidance Excluding 7kboepd gas [Low Guidance Indicated per Q1 2024 Update RNS] -> $32,345
EV/BARREL-USD 2023 Avg Production (Excluding 6kboepd Gas) -> $31,210
EV/BARREL-USD 2022 Avg Production -> $29,116
Abandonment / Decommissioning Liability (FY 2023 Results) -> $377,900,000
EV/BARREL (2024 Low Guidance) with Decommissioning Liability -> $39,216
2P Reserves per FY 2023 Results -> 212,000,000
Enterprise Value / 2P Reserves (Per Barrel) -> $8.39
EV (Including Decom)/2P (Per Barrel) -> $10.17

[xxnjr] 28/11/2024 10:40

Tullow Oil’s share price was down more than 10% in early morning trading on Thursday after the company reported its free cash flow for 2024 will be significantly below expectations.

The London-listed player, whose key operated assets are the producing Jubilee and Tweneboa-Enyenra-Ntomme (TEN) fields offshore Ghana, had previously guided that cash flow for this year would be in the $200 million to $300 million range.

However, in a trading update, the company reported that due to production issues at Jubilee, free cash flow is now predicted to be between $150 million and $200 million.

[You need a subscription to read the article from Upstream]

[up just a little bit] 28/11/2024 10:02

Still rather deal with the facts.

[bones698] 28/11/2024 09:54

Will continue to drop as the debts will kill this off eventually . Awful company ran by greedy and incompetent management

[chesty1] 28/11/2024 09:32

Market doesn't like the facts though

[up just a little bit] 28/11/2024 08:22

At least we are dealing with facts now.

[xxnjr] 28/11/2024 08:04

A bit surprised the company haven't bitten the bullet at this juncture and downgraded production guidance further, although they do say

"The information contained herein has not been audited and may be subject to further review and amendment....." which gives them further scope to do so! I'd suggest it might be worth reminding what happened last year...!

This is how 2023 guidance progressed.

The 2023 january trading update indicated 2023FY oil production guided to be in the range of (58-64) Kbopd.

Oil Production guidance (58-64) was maintained at March Results, the May AGM and the July Trading Update. Then “narrowed̶1; from (58-64) to (58-60) at Sept 2023/1H results. Then further downgraded to “marginally below (58-60)” at Nov 15th trading update. The 2024 Jan trading update, which one would have hoped would be pretty accurate, told us 2023 “full year working interest production averaged c.63 kboepd in 2023, including c.6 kboepd of Jubilee gas.”

Indicating approx 57K bopd oil production for the year of 2023.

Actual production as per 2023 full year results turned out to be only 55,800 bopd...!

afaics 2024 guidance seems to be following the same themes as we saw last year.

I'm taking todays guidance with a pinch of salt.

[xxnjr] 27/11/2024 08:13

Alfiex

the afr int story header says

"The British junior's shareholders want the firm to act soon on finding a more dynamic stock market, making new acquisitions and rapidly developing Kenyan reserves...." and was placed in the Nigeria section.

So one presumes Nigeria is a potential target area. The only thing TLW has to offer is knowledge of how to run an FPSO.

Kenya is a non-starter afaics. it's just too difficult. (politics/green lobby/no partners/too expensive/banks reluctant to invest in AFR pipeline projects)

[xxnjr] 27/11/2024 08:04

Good. Something needs to happen to counteract current failed strategy.

Meanwhile. Tacky Races. Will Rahul get another massive bonus, which for 2024 year will have 50% of the potential award calculated on TSR of TLW vs TSR of the nominated comparator group.

2024 YTD share price Gain/Loss

Africa Oil: -20.5%
Capricorn: 7.85%
Energean: 5.14%
Enquest: -12.0%
Harbour Energy: -18.46%
Kosmos Energy: -43.09%
Pharos Energy: -4.89%
Seplat Energy: +68.77%
BW Energy: -26.47%
Diversified Energy: 6.88%
Maurem et Prom: -11.23%

Average of comparator group: -4.36%

TLW YTD: -39.7%

Answer no!

He will still get bonus from other 'soft' KPI's like riding a bicycle to work, smiling to the reception desk etc etc. But the poor share price performance has halved the "opportunity" from 4X of base salary to 2X.

[alfiex] 27/11/2024 07:27

Sorry not got subscription but looks like something is happening giving Rahul some pressure https://www.africaintelligence.com/west-africa/2024/11/26/tullow-oil-management-under-pressure-to-find-new-sources-of-growth,110344340-eve