Tullow Oil Share Discussion Threads

[xxnjr] 10/1/2024 15:41

Now GALP appear to have made a huge discovery in Namibia!

[alfiex] 10/1/2024 13:02

Even the world's strongest man is wavering here!!!

[hubshank] 10/1/2024 12:26

We touched 40p a couple of times in most recent bull run but it didn't close at 40p. Be strong and hold on (not advice)

[bobex] 10/1/2024 11:46

If an investor loses their 💰 money on the stock market by selling at loss that money lands in someone else’s pocket I guess; it doesn’t disappear into the air… or is it that it just hangs around and nobody wants it? With that in mind falls in share prices like this make sense. Part of the game.

[badger36] 10/1/2024 10:35

Well the 20s are much closer. Wish the hell it was bought out and end this misery. 46 cents and I'm even and glad to be finished with African corruption

[subsurface] 10/1/2024 10:28

Tea leaves say 55p and production guidance 64 to 69

[mcsean2164] 10/1/2024 10:18

My target is 50p. Im beginning to wonder if we'll ever break 40p😞

[xxnjr] 10/1/2024 08:38

All

- what 2024FY production guidance will be given in the upcoming Jan Trading update?

- what will the TLW stock price be end of 2024?

[ctc1] 10/1/2024 08:25

I think the company have achieved a massive amount given where they have come from in a relatively short time. I am looking forward to the future and recognise things do not always turn out as they were planned, especially in east and west Africa. On the whole the leadership at tlw agree doing great.

[xxnjr] 09/1/2024 23:29

Xx...What would you have done in Rahul’s position?

Heck I'm not qualified to run the company. I have no training whatsoever in oil and gas. Yet despite that it's probably fair to say my production commentary (so far) is generally more reliable than the company provide. And I haven't benefitted from being issued 9m share options to join the company, nor received £4m in remuneration including bonus's for my first 2.5yrs (2020/21/22) plus another 4.6m LTIP(?) shares as Rahul has! (see rns at bottom)

One of the things I wouldn't have done is exit our position in Namibia in the middle of a high profile 90 day well on a giant prospect on the block next door!

One thing I would do is be more open with communications so investors don't unwittingly get the wrong impression. for example this recent rns on the '26 bonds said



“Deploying cash from our balance sheet to buy back the 2026 Notes demonstrates our confidence in the business and our ongoing cash flow generation. Through this transaction we are reducing gross debt by $114.8 million and we will be saving $28.9 million on coupon payments. Together with the $100 million annual repayment of 2026 Notes in May and the purchase of $166.5 million of 2025 Notes in June this brings our total debt reduction this year to $381.3 million and marks the next step in our objective to be a low-debt business by 2025.”

A few weeks later the '25 bonds rns said



“2023 has been a transformative year for our balance sheet. Following the start-up of the Jubilee South East project earlier this year, we are now in a period of material free cash flow, with approximately $800 million expected to be generated between 2023 to 2025. This free cash flow, together with cash on balance sheet and the $400 million notes facility commitment from Glencore, will allow us to fully address all outstanding 2025 Notes and puts us in a strong position to successfully refinance the remaining 2026 Notes. We have reduced gross debt by almost $400 million this year and we remain on track to becoming a low-debt business with a sustainable capital structure.”

Sounds good but analyse these rns's and you'll see Tullow have borrowed about $120m to repay the 2025 bonds at an interest rate of SOFR + 10% = 15.31% p/annum = $18.3m interest on an annualised basis to cover that loan amount if not repaid. Maybe it will function like a bridging facility and be repaid sooner when cash is available but even so none of this was spelt out in their second rns. And if it's not repaid within one year the extra interest on that loan cancels out pro-rata 12 months of the coupon saving highlighted in the first rns.

One thing I would try not do is set the bar so high that you miss the lower range of your production forecast or future year projections (easier said than done!).

And if there is a problem with the water injection tell us about it when it happens not slip it out months later lacking the detail to enable investors to judge how serious/long lasting the issue is.

And on the TIP/LTIP as CEO I'd lead by example and migrate to the latter scheme on inception considering the original TIP was deemed out of sync with current good practise and not aligned to shareholders interests. Incidentally does anyone know why Rahul received these as afaics he's not entering the LTIP scheme until 2025?



Does this mean he's getting 4.6m shares for 2023 LTIP and will also get 2023 TIP award as well? Seems odd but I'm not familiar with the new scheme yet.

[subsurface] 09/1/2024 22:13

Phillis,Rahul and Investors need to

Sharpen up on the Foresight as opposed to the Hindsite as BOOTY said look forwards
improve on news flow would also help.

[mcsean2164] 09/1/2024 21:41

Gadzooks! What is happening to the SP?

[phillis] 09/1/2024 19:37

Xx
What would you have done in Rahul’s position

[badger36] 09/1/2024 13:29

Who is responsible for making a market in the share. The volume is pathetic vs the outstanding share count. It's one of worst performance ever for the past five years

[bobex] 09/1/2024 12:37

Oil up share price down. Repeating pattern I should say. So glad to have seen this again…

[bootycall] 09/1/2024 09:41

@xxnjr

Interesting point of view, with many comments hitting the nail on the head. However, successful investing requires you to filter the noise and focus on the future.
What does the results of the bond tender tell you ? Will the company be able to extend their debt maturities ? For the last 3 years the share price has represented stub equity..the lack of progress partly the failure of the Ghana authorities to approve the Ten FDP whilst Jubilee is now firing on all cylinders and is a very valuable asset. I criticised Rahul’s naivety in being suckered into a Capricorn deal where his role amounted to a stalking horse who could be easily used.
Kenya must be close…so blink all you long suffering shareholders…just blink and you will miss this opportunity.
Rahul is highly competent but incredibly slow and thorough. Whilst frustrating, he is a safe pair of hands. I would prefer someone more dynamic but the Board who appointed him probably got exactly what they were looking for. Furthermore, the M&A market is operational again. If your view starts to prevail then I would see a reasonable chance of a takeover of this Company because there is now substantial cash generation post Jubilee SE coming on stream. This is not a comment I make lightly but the cash flow yields are compelling in a falling interest rate cycle.


Please do not rely on the facts or opinions expressed in the above post when making an investment decision.

[subsurface] 09/1/2024 02:14

MCsean I agree very disappointing
I Blame myself too
1 Not selling at 16 pounds
2 Not buying at 8 pence
3 Not selling during the Rights Issue and buying back at the lower offer price
There has been opportunities to make money in Tullow its a matter of waiting for the next one to come around and of course taking it..a change in mind set for me.

Rahul is a safe pair of hands,we need this debt to keep falling then perhaps we can get back to Risk Reward ,what we cannot do is high Risk and lose and add to the debt.
Ilike the finance man knows his stuff.

Its not like investing in Shell or BP who are solid and can weather a storm thats something else I have learned.


Tullow has inherent risk dealing in Africa and Jubilee the mainstay,enough said
good luck for 2024.

[mcsean2164] 08/1/2024 18:01

Share price capitulation. Very disappointing. I think tlw is my worst investment ever. Agree xxjnr, Rahul has not delivered.

[xxnjr] 08/1/2024 16:59

Rahul has been in the job for 3.5 yrs now hasn't he?. Depending on your point of view you could either say he's done ok (no more than that) or he hasn't delivered.

I reckon he's done ok (no more than that) as he successfully reset the strategy; i.e no or little exploration, concentrate on producing assets, invest in JSE, lower capex and opex etc, achieve high production uptime and reduce debt.

I also reckon he hasn't delivered that which was projected or inferred!!!!

Despite the luck of having >$80 oil for much of his tenure the share price is more or less what it was when he took over on/about 1st Jul 2020 when Brent was only about $40/bbl. can't believe 3.5 yrs has passed and can't believe share price is more or less the same!!!

His Capital Markets Presentation suggested production would be between
64K bopd and 80Kbopd for 10 yrs starting 2021. That's not going according to plan

2021 59.2K bopd
2022 61.1K bopd
2023 c.57.5K bopd (at a guess)
And don't forget we bought 'another 5K bopd' from Anadarko/Kosmos pre-empt in 2022. Without that the numbers would look even more dire. And let us not forget we used to produce at 75K to 90K bopd in prior years.

Then he told us TEN was a 45K bopd oil field with 'infill and defined projects'.
Then he told us 2 TEN N'tomme Riser 'Development' wells were being drilled.
The 'development' wells failed to find the commercial oil that was already booked somewhere as 'Reserves' or 'Resources' resulting in a $391m impairment that year mostly down to TEN.
TEN today seems more like an 15K to 18K bopd field. 1/3rd of Rahul's projection for oil production.

Then he told us we were taking over Capricorn Energy.
That didn't happen because the offer didn't fairly value the target.

Then he told us JUB/JSE would produce at an average of 95K to 105K bopd over 2Q23.
Then on two separate occasions he told us JUB/JSE was producing at 107K.
He didn't tell us (until later!) water injection issues meant production was 10K bopd short.

I won't mention Kenya. I won't mention Guyana. I won't mention Namibia. I won't mention farm outs not materialising.

Even with not mentioning those it's pretty clear that (so far) Rahul's impact has been significantly less than his own projections. As a shareholder I would really love to be able to say something hugely positive about the future but after 3.5yrs I'm still waiting for evidence of a production lead turnaround!

[hubshank] 08/1/2024 16:43

Jefferies had them at underperform last April original price target 40p and downgraded to 25p. Interesting how they hit 40p last week and are currently retracing.

[xxnjr] 08/1/2024 15:46

Jefferies apparently said "offshore Ghana, Tullow Oil growth is limited as excess capital is used to deleverage, rather than growth (cut to 'underperform')."

[badger36] 08/1/2024 11:16

I've seen Jeffries and Wainwright operate in US. Doing book running for bonds and notes and operating for shorts on the other side

[hubshank] 08/1/2024 10:38

It had crossed my mind that they were doing some sort of pairs trading. I haven't ever had a good feeling about Jefferies but with no sound basis, so interesting you say that. Maybe something historical that I can no longer recall.

[badger36] 08/1/2024 10:03

Jeffries and Wainwright are two of the most disreputable outfits I'd do the opposite

[hubshank] 08/1/2024 09:30

Tlw have been downgraded by Jeffries brokers. I don't think they have ever been a big fan of TLW.