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Ammu
I will raise issues and say what I think regardless of if I am investing or not.
I said a while ago, that the only way to make money in oil stocks was to trade with an eye on Brent.
I note that you are inclined to comment in a way that reflects your investment status and that you assume others have the same motives.
Ammu
I brought back in on the 28th April - I did mention at the time.
Buy back in chilting. Now is not the time to trade this as brent above 65++......
I would be worried if brent goes sub 60 but at current poo enquest making **** loads of money...
Chilting will disappear as sp gets blue.
She gets all excited when sp goes red lol.....
Moody's are always super cautious - remember there assessment of a company is as a credit agency, not as a broker.
The point about refinancing is what you would expect them to say, alongside their caution about oil prices.
Its the other points that they raise that are important and they should be addressed by AB alongside the refinancing, because the medium-long term future of Enquest is still unclear.
Fannie Mae's proved Moody's is a complete scam they couldn't predict a tide let alone a tsunami why anybody pays them is beyond me.
Romaron, yeah what a nonsense from Moodys.
Enq can now hedge and pay the RCF on time with FCF.
Maybe they need take 30-40m from the pocket but that’s it.
This is the relevant text from Moody's
" The Caa1 CFR assigned to Enquest plc reflects its high leverage and the likely need to refinance $335 million amortization due in October 2021 that Moody's is uncertain that the company will be able to repay from organic cash flow generation, especially in a low oil price environment.
The rating also reflects the limited size of the company and its concentration of assets and reserves in the mature UK North Sea, only partially mitigated by some assets in Malaysia, and the moderate 2P reserve life of the company, underlying the company need to bring new resources to sustain production in the medium term.
The rating is supported by the company's robust operating track record as an efficient independent UK North Sea oil and gas company and by relatively benign industry and regulatory environment in the UK and Malaysia."
It does seem to backtrack regarding the reserves and makes a new point about the size of the company.
Both these points are relevant.
Although AB has gone a long way to resolving the reserves issue, it is by no means clear, so far, that current production can be maintained over the next 5-10 years.
I still think that a merger between Enquest and another oil company with AB keeping control would be the best option for the medium-long term.
The bonds that Tullow are repaying early due 15 April 2022 closed yesterday at 98.75 and 98. Stressed? I don't think so. There is usually smart money involved in bonds.
Their 2025 bonds are trading at around 86. In November they were around 55.
London, 02 November 2020 -- Moody's Investors Service, ("Moody's") today downgraded Tullow Oil plc's ("Tullow") Corporate Family Rating (CFR) to Caa1 from B3 and the Probability of Default Rating (PDR) to Caa1-PD from B3-PD. Moody's also confirmed the Caa2 ratings assigned to Tullow Oil's senior unsecured notes due in 2022 and in 2025. The outlook on all ratings was changed to negative from ratings under review.
This concludes the review for downgrade initiated by Moody's on 25 March 2020.
RATINGS RATIONALE
Today's rating action reflects Moody's expectation that a more prolonged downturn and slower recovery of the oil prices in the next 12-18 months, compared to previous expectations, will significantly affect Tullow Oil, given the high FCF break-even point of Tullow Oil at approximately $40/bbl. With no or limited sustained recovery in the pricing environment in the next 12-18 months, Moody's does not believe that Tullow Oil's capital structure will be sustainable in the medium term and it remains doubtful that the company will have the resources to repay the $650 million senior unsecured notes maturing in 2022, in the absence of additional disposals (which may weaken the profitability and/or the growth prospects of the company further) or capital injections from shareholders.
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Just flicking around. It looks like HBR don't have a Moody rating and from memory neither did PMO. I'm no expert on TLW but they appear to be giving them a hard time too. It's a bit like the adage that to borrow money from a bank you have to prove first that you don't need it. However, their "ratings rationale" seems to have missed the dartboard altogether.
Hi Therapist, I fail to see the point of the announcement. It almost looks like cut & paste. This from 17 June 20:
The rating downgrade reflects Moody's expectation that - despite the rebound in oil prices since mid-April and the significant cuts in operating costs and capital expenditure - an extended period of low oil prices averaging USD35 per barrel over the 2020-2021 period would require a third of the final amortisation of USD360 million due under the company's credit facility in October 2021 to be refinanced."
So Moody's are saying there is a risk of the poo collapsing. That is true as is Canvey Island being hit by a tsunami. This is quite worrying if you live in Essex. I think AB should stop paying for coverage. There is a get out clause in the next periodic review. Maybe this is their response to pressure from the company and is a form of code? I'd be mightily p*ssed if I was AB and a periodic review didn't arrive soon.
Hi,
https://www.moodys.com/research/Moodys-announces-completion-of-a-periodic-review-of-ratings-of--PR_443251?cid=7QFRKQSZE021
Couple of sentences in here, nothing new.
GLAXXX