Tullow Oil Share Discussion Threads

[cashandcard] 09/3/2023 07:39

I would suggest they need to sell what they can and clear some large chunks of that debt. There's value in the portfolio but it will never be realised, especially buried under all that debt. Hard to believe this was once worth Billions in marketcap. It's a shadow of itself and really offers prospective investors nothing for the future.Cash

[ryad123] 09/3/2023 06:09

The truth is there are far many better investments with less risks,gulf keystone delivered a lot of dividends in the past couple of years, if you can't make money at 85 dollars a barel then when? Why on earth would management make a 100 dollars a barel assumption for that will make many other oil companies even bigger profits, the debt level remains too high with no sign of going down, add to that the poor hedges, I mean between 55 and 75 dollars a barel, 55 dollars hedge give me a break, this dog of a company is run for the benefit of the bondholders and creditors not for equity holders, how could the share price be marginally higher than in the middle of covid and much lower oil prices, you have got to wonder if this is sheer incompetence by management or the company a zombie.

[xxnjr] 09/3/2023 01:19

Investors Chronicle. Tullow Oil (TLW) had a wild ride in 2022, finding a solution to its debt load through a merger with Capricorn Energy (CNE) that fell through after investor protest. Despite that drama, Tullow is back where it started, in debt terms, with borrowings down just 4 per cent from the end of 2021 to $2.47bn (£2.1bn).

Sales reflected the 40 per cent uptick in oil prices off the back of consistent production performance in the year, although a significant hedging programme has limited the exposure to prices above $75 a barrel. This year, over half of sales are hedged between $75 and $55 a barrel. This will drop to around a fifth of production in 2024.

Earnings remained subdued due to a higher tax bill and non-cash impairments of $381mn, although these were balanced out by a $197mn gain on the deal to take a greater stake in the Jubilee oil field. Free cash flow only saw a 9 per cent uptick on 2021, at $267mn. The company has forecast 2023 free cash of $100mn, with an average oil price of $80 a barrel.

Chief executive Rahul Dhir said 2023 would be the “year people stop worrying about the debt at Tullow”. Higher production will help this, although consensus forecasts see the company only making a dent in borrowings in 2024, as the bulk of it matures. The earnings outlook is flat as well, with Ebtida dropping from 2022 levels to $1.3bn in 2023 and 2024, as per the forecasts.

The heavy borrowings aside, Tullow is cheap for its production profile and assets. For investors keen on oil exposure and higher risk, this could be a good entry point. We are more circumspect given the sector’s volatility, however. Hold.

[crazi] 08/3/2023 18:57

The large "overdone" slice is the Corporate Brokers chunk of profit as they buy cheap now to sell higher later when they let the price rise back to reasonable levels...

[xxnjr] 08/3/2023 18:32

That one is easy to answer. KOS are forecasting 50% production growth over next 24 months mainly as a result of phase 1 Tortue FLNG coming on stream end of 2023. Plus a bit of extra from Jubilee and less exposure to TEN than Tullow. Then Tortue Phase 2, plus another 20 TCF after that or whatever in the development queue. Agree sell off here looks a bit overdone!

[bootycall] 08/3/2023 18:14

Oh the irony..from the second half of 2023 the company becomes massively cash flow positive …and everyone is starting to panic. Not sure what is go on in Kenya but Kosmos latest quarterly results were well received in the same acreage. Go figure ! Booty

[xxnjr] 08/3/2023 18:02

mcs - I know it's the metric everyone uses but net debt to EBITDAX ratio is a meaningless indicator for an E&P (at least in my head). Why? It's backward looking. If OP drops to say $70, EBITDAX crashes and 1.3X ratio quickly becomes >2X. Or even 3X!!!

[kulvinder] 08/3/2023 16:03

Like sat, best of luck and same time if this does recover then I will also benefit by getting back some of my losses. But I really think the share price has been decimated due to the failure of the proposed merger....wish we had never had it put forward.

[crazi] 08/3/2023 15:57

Decent results. Back to profit. Debt down nearly 300Mil

Like I have mentioned before - the Corporate Brokers (MM's) are as corrupt as they come. They weight the order book way too much on Tullow. CEO needs to focus some on the share price and sack them. Request an audit of the order book.

I've filled up so will now wait it out...

[kulvinder] 08/3/2023 15:48

Every drop being squeezed out of this...drip drip down.....likely to see 31p at this rate, the share in free fall from the 52p area when the merger was announced.

[kulvinder] 08/3/2023 15:45

Crazi, best of luck with your purchase, as I certainly have not had any with this share....

[dros1] 08/3/2023 15:39

Jefferies analyst Mark Wilson said in an email that even with new production coming onstream in the second half of the year, Tullow's overall production was to expected to remain only steady.

He also pointed to the $100 million cash flow guidance for 2023 at $80 a barrel as a reason for the share price weakness, given oil prices are already at around $83 a barrel .

[mcsean2164] 08/3/2023 15:29

-- Net debt(1) at year-end reduced to $1,864 million (2021: $2,131 million); cash gearing of net debt to EBITDAX(1) of 1.3 times (2021: 2.2 times) three years ahead of original target; liquidity headroom of $1,055 million (2021: $876 million).

I'm baffled. All seems to be going alright except the share price. Any ideas what caused the drop?

not a 3 year low. It was below 10p in 2020

I'm scratching my head. Don't understand the share price here. Maybe a reflection on the new costs of funding even though I believe tullow are okay on that front for a while??

[djderry] 08/3/2023 15:08

Very happy with the results.A positive trajectory,management need to focus on execution.Attention to costs,investing to increase production and less onerous hedging should see them prosper.

[waldron] 08/3/2023 14:54

Tullow Oil remains a recovery play

A heavy debt load means this oil and gas producer is lowly rated, but its assets are producing consistently

March 8, 2023

By Alex Hamer
investors chronicle


Earnings constrained by impairment and hedging

Borrowings down just 4 per cent on 2021

Tullow Oil (TLW) had a wild ride in 2022, finding a solution to its debt load through a merger with Capricorn Energy (CNE) that fell through after investor protest. Despite that drama, Tullow is back where it started, in debt terms, with borrowings down just 4 per cent from the end of 2021 to $2.47bn (£2.1bn).

[crazi] 08/3/2023 14:42

Definitely very cheap. Just bought back in...

[alfiex] 08/3/2023 14:36

Yes now 3 year low

[alfiex] 08/3/2023 14:34

This is typical Tullow, dont think we will see 50p anytime soon.

[1224saj] 08/3/2023 13:03

Disappointed that the MM's see this as a mark down

[waldron] 08/3/2023 12:19

Https://www.myjoyonline.com/tullow-oil-recovers-from-loss-position-to-record-49m-profit-in-2022/


2023 Outlook for Tullow Oil

Gross production from Jubilee is expected to increase to over 100 kbopd with four new wells at Jubilee South East and a further Jubilee producer onstream later this year.

Tullow Oil said it is also forecasting that capital expenditure will be pegged at $400 million.

The statement showed that Ghana will account for significant amount of the capital expenditure.

[zingaro] 08/3/2023 12:10

Probably the only event that could really change the outlook is Kenya. So wait and see.

[xxnjr] 08/3/2023 11:26

The actual net debt $1,864m came in well below "$1.9bn" of last trading update. Going forwards CAPEX is first half weighted, meaning net debt will increase again, however after JSE wells come on, plus less oil volumes hedged then FCF generation and debt deleveraging will accelerate with hopefully meaningful debt reduction in 2H23 and 2024.

Assumptions on TEN are now a lot more more realistic than before. It only produces c.11K net bopd to Tullow these days. Even if it produced zero it probably wouldn't kill off the company. OTOH TLW may get better pricing for gas with a new GSA which would be for about 50 mmscfd net to Tullow at current off take rates.

There has been extremely good cost control under Rahul.

Looks like we can see a flickering of light at the end of the debt tunnel. Not quite there yet but at least there's some light visible.

Thought it was quite an encouraging presentation overall. Needs the OP to stay strong though.

[mccracken227] 08/3/2023 08:49

Yes it is depressing to watch it fall day by day. Down 46% in the last year, like most wish I'd got out years ago