Tullow Oil Share Discussion Threads

[hojjat] 24/1/2024 15:11

Thanks xxnjr
With all the wars going on in the Middle East, oil cannot get to 58, can it?

[xxnjr] 24/1/2024 14:16

One good point is "material uncapped exposure to oil price upside from June once legacy hedges have rolled off, with c.20% of sales volumes capped at weighted average price of $114/bbl for the period June to December."

meaning, i think, that 20% of sv in in a collar of say $58 to $114. If that's the case we get $114/bbl on that, unless the OP falls below $58 in which case we get $58 or lower?

[xxnjr] 24/1/2024 13:56

SS,

Don't really know but it's probably different this time around as would imagine/hope!!! the Maersk Venturer contract is a fixed term followed by a series of options to extend; i.e we are not taking up all or part of the last option.

@bootycall..... I know at times you think I'm a raving shorter. I'm not. I just call it as I see it. Good or bad. Mind you I do tend to "go on" about production rather a lot! Maybe I should shut up and just mention cashflow! ;-)

@cashandcard..... Agreed. Maybe there is no one left in the exploration dept to save costs?

[cashandcard] 24/1/2024 13:31

xxnjr,Its still mind blowing they let go of 2813B in Namibia without waiting a little longer on Total and Shell to complete their ops first. Chevron are now planning a 10 well maiden drill campaign there. Cash

[subsurface] 24/1/2024 13:22

Iwonder how much it will cost to stop the drilling contract remember SEADRILL

[bootycall] 24/1/2024 13:08

@xxnjr Thank you for some informative posts outlining the status quo. Nothing unreasonable with your observations based on the information available to us . The Company has to buck its communication efforts up. It is obvious from press articles that Rahul is down in Kenya this week trying to smooth over local concerns made to the Governor of Turkana from goat herders in Turkana being part of the PR initiative. In my opinion an intermediate solution using trucking is an easy win for Kenya which is acutely affected by a shortage of dollar denominated reserves. Even a relatively small project could sustain hundreds of millions of additional revenues..to be shared. I cannot believe that with so much money at stake, we will not make progress shortly. Remember the consultants report was due in March to the NOC. I view today as more of a holding statement until we get stabilised production from the new JSE wells. With Kosmos reporting shortly and the full years results being announced in early March, things might appear a little brighter. No CEO wants to make statements based around when political leaders finally agree to sign off what has been agreed for ages ? ALl speculation on my behalf, of course . Booty

[s34icknote] 24/1/2024 12:38

Do we know what each dollar is in real terms ? Should oil start rising again ?

[sarkasm] 24/1/2024 12:04

Tullow gears up for profitability boost at core assets

Company plans to pause drilling until 2025 as it prepares for new investment cycle in Ghana and Kenya


24 January 2024 8:46 GMT Updated 24 January 2024 10:45 GMT
By Vladimir Afanasiev

UK-based independent Tullow Oil has promised to achieve healthy cash generation this year from its operations at oil assets in Africa following lower capital spending and the expiry of some old hedges that capped the sale price of its oil well below the market.

The company said in its trading statement on Wednesday it estimates to achieve free cash flow between $200 million and $300 million in 2024 against $170 million last year, based on an assumed oil price of $80 per barrel.

Tullow explained that the exact cash flow amount it aims to achieve will depend upon contractual arrangements to determine the timing of payment for 18 to 19 cargoes from Ghana that are expected to sold during the year.

Better cash generation will come as Tullow and its partners plan to take a break from drilling in Ghana while the existing well stock upholds production at the Jubilee field, and the decline at the Twenboa-Enyenra-Ntomme (TEN) fields continues to be effectively minimised.

Tullow has projects in Ghana and Kenya.
Tullow share price boost after deal with Glencore — but Kenya concerns remain


In its latest update, Tullow has penciled capital spending of $250 million this year, 60% of which allocated to Jubilee and 25% to non-operated assets. The capex for the year is markedly lower than the $380 million of spending in 2023.

Drilling activities in Ghana are expected to resume in 2025, and the procurement process for a new rig will be started this year, the company said.

Tullow’s working interest production in 2024 is expected to average between 62,000 and 68,000 barrels of oil equivalent per day, including about 7000 boepd of natural gas, the company said.

Last year’s working interest production averaged 63,000 boepd, including about 6000 boepd of gas produced at Jubilee.

The company said that its extensive hedging portfolio caps about 60% of forecast sales volumes at a weighted average price of $58 per barrel throughout the year.

However, about 20% of sales volumes have been capped at a weighted average of $114 per barrel for the June to December period of this year, which is way above the current market price.

Tullow Oil well glitches in Ghana impact production - remedies at hand


Tullow also anticipates material uncapped exposure to the international oil price upside from June onwards, once legacy hedges expire.

UK-based Investec Bank said that Tullow's statement “reflects a steady operational year alongside an impressive year of debt reduction and balance sheet restoration. Importantly, the company is on track to strengthen its balance sheet, will continue to ramp up its free cash flow profile with organic growth, and is well positioned to be a low debt company by 2025”.

[hojjat] 24/1/2024 11:45

Earlier buys reported with delay appears as sell due to price rise

[hojjat] 24/1/2024 11:43

MMs are reporting earlier buys.
They off course appear as sell due to price rise since early morning

[xxnjr] 24/1/2024 11:40

We were all wrong on expected oil production guidance for 2024!

xxnjr: 61K-66K = 63.5K
SS: 64K-69K = 66.5K
alfiex: 68K
ctc1: 70K

TLW Guidance: 55K to 61K = 58K bopd

Bootycall suggested Jubilee @ 106K. TLW guidance 100K

Maybe TLW have under promised to over deliver ;-)

[s34icknote] 24/1/2024 09:26

Guess directors will top up today !

[hojjat] 24/1/2024 08:58

Oil and gas price has to go up.

Uranium passed $100 from less than $30 not long ago, this means higher electricity prices. Ev cars are not as evonomical given lack of infrastructure, electricityb & insurance cost.

Oil will be here to stay much longer.

[xxnjr] 24/1/2024 08:52

Obviously it's good the debt is down to $1.6bn and should reduce a further $200m over 2024. As for production; time will tell.

But basically they seem to have given up on TEN oil. No wells planned there. Jubilee tends to need a lot of wells to mitigate decline. And non-op also in decline. It is not a great picture.

[hojjat] 24/1/2024 08:37

Why MMs are not reporting some of buys?

[hojjat] 24/1/2024 08:30

They will report later, maybe 3 hours later.

[hojjat] 24/1/2024 08:25

It seems MMs are not reporting high volume buys.

[xxnjr] 24/1/2024 08:22

@bootycall

Yes indeed. No well timings in there. the thing is last year the Jan trading update guidance for 2023 was 58K to 64K oil and for 2024 the guidance is 3K lower at 55K to 61K oil and all that extra production Rahul was confidently predicting for current year sadly hasn't materialised.

And putting on my sceptic's cap

FCF guidance is not "$300m".
It is "$200m to $300m"
bit of uncertainty in there, although they do say

"with the range largely driven by timing of revenue receipts for 18 to 19 cargoes lifted in Ghana during the year."

18 Ghana cargos in 2023. To get 19 cargoes they would need to hit mid-range or higher of this years guidance.

[bootycall] 24/1/2024 08:11

@xxnjr It would be helpful if we knew when those five wells in Jubilee come on stream. No one seems to appreciate that the forecast is for average monthly production . Some of the new wells will offset natural decline, of course, but there should also be a decent uplift, as was the case last year. Why drill more wells if you can meet nameplate capacity from existing stock.
This year should be the last real decommissioning year for many years to come… if Kenya is signed the upside is several hundred million? on the market cap. The delays are hugely frustrating, just as getting the FDP approved for Ten in Ghana…but things could change radically in the first 6 months of the year.
No one likes watching the paint dry but waking up in the morning to find a deal signed you have been waiting four years for, is more perplexing. Booty


Please do not rely on the facts or opinions contained in the above post when making an investment decision. I own the shares.

[xxnjr] 24/1/2024 08:00

TEN decline is "effectively minimised". Really?

2023 initial guidance: 20K bopd.
2024 initial guidance: 16.5 kbopd

Decline: -17.5%

Jubilee: 95K 2023 initial, 2024 100K

+5.2%

Non-op: 14K 2023 initial, 2024 11K

Decline: -21.5% Looks like Perenco got the best of that asset swap!

[djderry] 24/1/2024 07:55

I think the market will be very pleased indeed.