Tullow Oil Share Discussion Threads

[sirrux] 15/1/2020 19:48

Larry Fink, is he downsizing? He needs to change the name of his business if he really believes, Blackrock sounds like a lump of coal to me, a fossil fuel in itself.

[auson1] 15/1/2020 19:44

Nah they got that bit right $1.5bn but this bit not so right.



The group expects to produce 86,700 barrels of oil a day this year, in line with what it flagged last month.

[sentimentrules] 15/1/2020 19:37

All quoting 1.5B or do you mean gbp?

[edmondj] 15/1/2020 19:35

I copy/pasted with the weblink! ;-)

[auson1] 15/1/2020 19:33

Edmondj,

Was that really in FT £1.5b pounds ? wow can't get the staff these days !

Only a $400m typo oops

[sentimentrules] 15/1/2020 19:30

Very true Sirrux. Bull or Bear position - got to respect other side of the market. More than ever when executed.

They should respect the shorters/sellers and thank them.

What makes me laugh is that the bulls seek low prices. They never seem to consider what drove price there - or care about the bulls in before them higher up.

They celebrate when found low value

And blame shorters when they got it wrong. Blame the very people who often give them buy value (when they get it right)

[sirrux] 15/1/2020 19:26

Think we all know they've screwed up SR but there are always people out for blood!

[waldron] 15/1/2020 19:22

Tullow to Take $1.5 Billion Charge After Calamitous Year

Paul Burkhardt, Bloomberg News








BC-Tullow-to-Take-$15-Billion-Charge-After-Calamitous-Year

BC-Tullow-to-Take-$15-Billion-Charge-After-Calamitous-Year , Paul Burkhardt

(Bloomberg) -- Sign up to our Next Africa newsletter and follow Bloomberg Africa on Twitter

Tullow Oil Plc expects to take a charge of $1.5 billion when it reports 2019 results, capping a terrible year for the debt-strapped company.

The pretax sum of impairments and exploration write-offs reflects a lower oil-price forecast and a cut in reserves at a field in Ghana. Tullow’s assets in the West African country performed poorly in 2019, a year that also saw delays at East African projects, disappointing drilling results in Guyana and the resignation of Chief Executive Officer Paul McDade.

While Wednesday’s trading update indicated yet more obstacles for the company -- including the suspension of a pilot project in Kenya -- Tullow maintained its 2020 production guidance of 70,000 to 80,000 barrels a day and said it expects underlying free cash flow of at least $150 million.

“The news today reaffirms the outlook for 2020 and should increase certainty,” analysts at Davy Research said in a note. “Tullow has taken the opportunity to reset the balance sheet.”

The shares rose 1% to 59.76 pence at 11:28 a.m. in London, after earlier sliding 6.7%. The stock plummeted 64% last year -- the most on the Stoxx Europe 600 Oil & Gas index -- amid setbacks in Guyana and lower production forecasts in West Africa. The company is now conducting a review of its business and operations, resulting in a “smaller, more focused interim executive team,” it said on Wednesday.

The new leadership team is half the size of the previous line-up under McDade, comprising Executive Chairman Dorothy Thompson, Chief Financial Officer Les Wood, Chief Operating Officer Mark MacFarlane and Executive Vice President for Change, Ian Cloke. The search for a new CEO is under way and both internal and external candidates will be considered, Thompson said.

Guyana Wells

After years of focusing on Africa, Tullow plowed funds into drilling off Guyana last year in a closely watched campaign, following earlier finds there by Exxon Mobil Corp. Tullow struck oil several times, though much of it turned out to be heavy, sulfurous crude.

The company is now slowing the pace of activity in the South American country as it reviews last year’s results, according to COO MacFarlane. It’s “highly unlikely” there will be another well drilled there in 2020, he said on a call. Elsewhere on the continent, a well off Peru is planned this month.

Tullow’s $1.5 billion charge reflects a revision to reserves at the TEN project’s Enyenra field in Ghana and a drop in the long-term oil-price assumption to $65 a barrel from $75, the company said. It also includes a writedown of exploration costs, mainly in Kenya and Uganda.

The charge “highlights the disappointing track record of capital allocation over the past few years,” but “clears another negative out of the way” ahead of full 2019 results on March 12, Citigroup analysts said in a note. The trading update is “broadly in line with expectations,” they said.

(Updates with analyst comment in fourth paragraph)

To contact the reporter on this story: Paul Burkhardt in Johannesburg at [e-mail]

To contact the editors responsible for this story: James Herron at [e-mail], Amanda Jordan, Rakteem Katakey

[texaschaser] 15/1/2020 19:21

Iamgreat1 aka @thelongergame aka ZM19 on LSE Aka jammydodger (stopped posting on 6th December set up iamgreat1 on 6th December and ZM19 on LSE 8th December Deramps under one name pumps on other names

[sentimentrules] 15/1/2020 19:19

With your money loooool

[porschepanamera] 15/1/2020 19:17

Well onwards and upwards from now, and hopefully a lot of the idiots who post by the minute will soon disappear

[edmondj] 15/1/2020 19:17

FT Lombard opinion:

Tullow will struggle for capital in a decarbonising world

Oil explorer has little chance of transformational transaction at good price



Matthew Vincent 2 HOURS AGO

“Climate change is different,” wrote Larry Fink this week. “Companies, investors . . . must prepare for a significant reallocation of capital,” said the chief executive of $7tn investor BlackRock. He could not have been referring to fossil-fuel explorer Tullow Oil, though. Investors have already reallocated so much capital from its shares that its market value fell 70 per cent, or £1.4bn, last month. And the company is already reallocating — and reducing — its own capital expenditure after writing down £1.5bn of producing assets, exploration costs and reserves on Wednesday.

Analysts at Citigroup said the writedown — while only an accounting measure, and half down to lower oil price assumptions — “highlights the disappointing record of capital allocation over the past few years”. For those investors who still hold equity in the FTSE 250 explorer, then, the question is whether a further reallocation of their own capital would be advisable this year.

December’s changes to production guidance suggest it would. Tullow admitted that producing almost a third less oil in 2020 — just 70,000 to 80,000 barrels of oil equivalent a day, down from nearer 100,000 — could neither sustain the dividend nor the careers of chief executive Paul McDade and exploration head Angus McCoss. It was not its first admission of over-optimism, either: it was the fourth cut to full-year guidance that shareholders had endured, leading analysts at broker Stifel to conclude “the market has completely lost trust in the company”. No wonder: the market is being paid no dividend while it waits in the hope that an oil company’s shares can be re-rated in a decarbonising world. BlackRock might still take this risk — it remains Tullow’s fifth-largest shareholder — but few others would.

However, Wednesday’s update suggests some shareholders might not want to reallocate their capital just yet. Tullow — under its now executive chair Dorothy Thompson, former boss of biomass power group Drax — said it is reviewing all aspects of its operations and cost base, to bring overheads in line with lower production, and keep those 70,000-odd barrels just as profitable at lower prices. It was confident enough to reiterate current year production, reserves and cash flow. It also indicated that it would look at whether it can monetise oil assets more quickly by selling for cash rather than going into production. Previously, some had speculated about rights issue plans — which the company denied — or a deal for all of the business.

But what are the chances of any transformational transaction, at a good price, in the current climate? Even before this week, market sentiment had been turning against oil companies, amid concerns over demand and sustainability. Now, according to Mr Fink, “as we pursue the path to a low-carbon world, investors are asking how they should modify their portfolios”. For many, buying into Tullow’s assets is unlikely to be one of those modifications.

[sentimentrules] 15/1/2020 19:16

Dont know why most bulls are blaming most things bar the one thats responsible. TLW

[leoneobull] 15/1/2020 19:16

Have you forgotten which I'd logged into?

[sirrux] 15/1/2020 19:15

Thanks, so it was just the papers sensationalising it as news? Much like the $1.5bn hole in the accounts today!

[sentimentrules] 15/1/2020 19:15

I transit connected haha

[sentimentrules] 15/1/2020 19:15

Shoulda sold low 60-s

[leoneobull] 15/1/2020 19:14

But you never leave the bed sit.....?

[sentimentrules] 15/1/2020 19:14

im surprised you were not more confident on its fall before this morning. I was pretty damn sure 1.3%

5.3% id have put house on

[auson1] 15/1/2020 19:13

Ok so shall I sell now and buy back at 22 ?

Or maybe not

[rbonnier] 15/1/2020 19:13

Shorts looking for sub 35P 😳

[sentimentrules] 15/1/2020 19:12

And thats a big short too

[edmondj] 15/1/2020 19:10

Oil prices will be far more significant than (conspiracy fears about) shorting.