Tullow Oil Share Discussion Threads

[waldron] 02/6/2022 07:57

Oil prices slide after report Saudi Arabia could step up if Russian output dips under sanctions


Published Wed, Jun 1 2022

10:36 PM EDT

Updated 3 Hours Ago

Weizhen Tan
@weizent
cnbc

Key Points

Oil prices fell in the morning of Asia trading hours, after the Financial Times reported Saudi Arabia is prepared to raise crude production if Russia’s output significantly falls following European Union sanctions.

EU leaders on Monday agreed to ban 90% of Russian crude by the end of the year as part of the bloc’s sixth sanctions package on Russia since it invaded Ukraine. That initially sent oil prices up.

Sources told the FT that Saudi Arabia, OPEC’s de facto leader, has not yet seen genuine shortages in the oil markets. But that situation could change as economies globally reopen.



Oil prices dropped following a report that Saudi Arabia is prepared to raise crude production if Russia’s output significantly falls following European Union sanctions.

The Financial Times reported, citing sources, Saudi Arabia is aware of the risks of a supply shortage and that it is “not in their interests to lose control of oil prices.”

Oil prices fell in the morning of Asia trading hours. International benchmark Brent crude futures were last down 1.68% at $114.34 per barrel. U.S. crude futures dropped 1.87% to $113.10 per barrel.

[fizzmiss] 02/6/2022 06:43

I wonder if the FSA will investigate the share price manipulation to enable Raul to get the worst possible value when handing his old company TLW on a cheap plate.

I said this would happen and here we are 2 years later.

Now we can see why the share price has been manipulated very low in a very fine trading range, whilst other stocks and oil have soared higher.

And Raul brought in this merger at the peak of oil, bad timing for TLW shareholders and great for his old mates.

Let's just hope oil and the gas price hold, or we will suffer badly.

[xxnjr] 01/6/2022 23:08

Place your bets for the new name. I'm going for Energy Africa

which coincidentally was TLW's best deal ever.

"In 2004 Tullow doubled in size as a result of the $500m Energy Africa acquisition. This was a transformational acquisition which gave Tullow substantial production of 54,000 boepd (50% oil; 50% gas) and a range of production and exploration assets in Uganda, Gabon, Equatorial Guinea, Namibia and Congo (B) among others. As a result of this major acquisition and other, smaller deals, Tullow recorded its highest levels of production, sales revenue, profits and cash flow. Tullow also completed a placing of £113m to help pay for Energy Africa."

[mcsean2164] 01/6/2022 21:59

Xxjnr,

Agree on everything you said except on Rahul. I'm invested in tullow as believe it represents serious value and selling us out at 52p is a real kick in the teeth.

I can see a bit of a bounce and dividends but significant upside potential lost, IMHO

[xxnjr] 01/6/2022 21:17

mcs, Ok beginning with D, yeah a bit asleep at the wheel until it was heading for the rocks. Agree with that. CNE is basically Egypt. 36K boepd; should be able to organically grow that to 40K, maybe +45K as the rocks are quite good. Don't panic but from memory its about 62% gas (sold internally at c. $2.80/Mcf!!!) and 38% liquids (mainly oil, sold at around brent pricing). OPEX costs are very low. The PSC is a little complicated as state owned EGPC pay the tax, recovering that from an allocation of produced barrels. It doesn't bother me as I also hold Apache who rate Egypt very highly; noting that they are about 70% liquids.

I'm not personally in the "Rahul didn't talk up the drilling" camp. Rahul likes to under promise and over deliver. And would suggest he prefers the drill bit do the talking; rather than bigging it up and then falling flat on his feet when the well results come in. On that subject; lets just mention those TEN "strategic wells". Afaics there haven't been any wells drilled before in, or near, the N'tomme riser area. Maybe it is even a completely new sand lobe that hasn't been produced from before? I say that because the existing oil production is some way to the south, then north of that its mainly gas condensate, until you get to the up-dip N'tomme riser area where suddenly it becomes oil again. Remember when the down-dip N'tomme gas injector was drilled recently what did they say; something like we found oil in the base of that well which is encouraging for the upcoming N'tomme Riser "strategic" wells which todays presentation (slide 7) tag as "Appraisal" wells. In other words; until we drill those 2 wells we aren't even 100% sure there is anything to develop yet, which explains why there is a gap between drilling the wells and installing the infrastructure with production coming on mid 2024.

Anyway I'm inclined to give Rahul a chance to see where he can take this in the medium term. The TLW 2025 Bonds jumped from 79.25% to 93.5% this morning.

[sunnysideup1] 01/6/2022 17:33

This nil premium merger will flush out some bidders for TLW, perhaps a state oil company from Asia. sit tight.

[horndean eagle] 01/6/2022 17:16

The only people to benefit from today's announcement are TLW bondholders. Up from mid 70s to low 90s. Awful deal for CNE holders. It is a back door rights issue for TLW and pretty much zero discount. Count your lucky stars if you are holding TLW equity.

[mcsean2164] 01/6/2022 16:57

xxnjr,

Was not referring to Rahul,it was the temporary one beginning with D who did the damage as far as I'm concerned.

Rahul okay but very disappointed as others have said that he didn't talk up our drilling campaign with this deal in the offing. I get it may have been difficult to find the right balance with the various political restraints.

In saying that the merged company will be open to a lot more investment by funds as its market cap will exceed one billion.

I invested in tullow as ethically it was one of the better oilers. I'll need to research CNE but will probably exit asap.

[janhar] 01/6/2022 16:50

This deal solves the debt problem and they should be able to renegotiate at lower rates, which was putting off some investors. It should provide more stability going forward.

[janhar] 01/6/2022 16:46

I've never really followed Cairn but I've heard he didn't do too bad a job at Cairn

[fizzmiss] 01/6/2022 16:44

Yes he did, and I predicted when Raul rode into town, he would deliver TLW to Cairn on a plate, cheap as chips, here we are!

All mocked and laughed at me, now who is laughing, pathetic the lot of you!

[xxnjr] 01/6/2022 16:42

"Management was chucked out and a spineless temporary CEO was appointed that firesaled assets and got funding at awful rates, they then hedged at really bad rates."

Ouch!!! I kind of disagree with that although get where you are coming from MCS.

The previous management were chucked out with good reason as they had written off $7bn on fruitless exploration, bad deals and complete and abject mismanagement of producing assets.

Disagree the new CEO is spineless. Company was on verge of bankruptcy when Rahul stepped in. Beggars can't be choosers. Development Assets only worth what someone is prepared to pay. Uganda was years away from 1st oil, even today years away from 1st oil, and was really only a development project suitable for a super-major type balance sheet which clearly Tullow didn't have.

Beggars can't be choosers. Yes financing was expensive. And the hedging was a condition of the refinancing. The alternative would have been bankruptcy! How would that have helped? This deal finally fixes Tullow's weak balance sheet which ought to result in cheaper financing going forwards.

And perhaps more acquisitions to come in W Africa?

[kulvinder] 01/6/2022 16:40

I believe he did Alf.....

[kulvinder] 01/6/2022 16:38

Today, if this merger is good for TLW, then why we at 53p today ? Looks like we been sold down the river...look out for another mauling when the share consolidation comes after the merger is complete to dilute value further.

[alfiex] 01/6/2022 16:35

Didn't Rahul used to run Cairn ?

[fizzmiss] 01/6/2022 15:58

Plus the TLW share price has been manipulated lower to enable a very very costly take over deal, as I predicted 2 years ago.

Nice one Raul!

Will say one thing, give it 2 years and TLW will be an amazing take-over target!

[mcsean2164] 01/6/2022 15:51

Inntolife,

Management was chucked out and a spineless temporary CEO was appointed that firesaled assets and got funding at awful rates, they then hedged at really bad rates.

On the horizon are very large resource upgrades as ten about to be drilled, better hedging, better funding rates etc. that's not properly in tullows price.

It's a bargain for CNE and a disaster for tullow holders like me that bought around £1.80

[fizzmiss] 01/6/2022 15:41

The market dont like this as much as rampers try and flip it.

Raul will not get best deal for shareholders, same as what happened with PMO.

I predicted this would happen and here we are.

Sad day for all TLW shareholders, all will be walking home in their nic nacks by the time Raul is done.

[xxnjr] 01/6/2022 15:31

Back to basics.

Repsol spud Beebei-1 in Guyana 31/5.

[orchestralis] 01/6/2022 15:10

I thought this may have moved more today in either direction.

[fizzmiss] 01/6/2022 15:02

Hello, As a CNE holder please would someone explain to me just what TLW did two years ago to warrant their large drop in share price and are the board members still in place that mucked up ?
Thanks

NO1 THEY BOOTED EM ALL OUT AND BROUGHT IN WORSE MUPPETS.

[phillis] 01/6/2022 14:58

Akin to a rights issue for TLW
should resolve their debt prob,ems