Member Info for giggady

I read the sale as for $750m, plus an interesting comment:

"The company expects that the cash flow from the assets mean the deal will pay itself back in less than three years at $65 a barrel Brent. Brent crude is now trading above $80 a barrel."

https://www.businesslive.co.za/bd/companies/energy/2021-10-13-occidental-offloads-ghana-oilfields-for-750m/

Worth a read...

https://www.ii.co.uk/analysis-commentary/stockwatch-has-oil-and-gas-explorer-turned-corner-ii521414

"Unless oil prices substantially de-rate again, and stay there, then overall the risk/reward profile favours upside – and recovery from current levels could be sharp, into a 100p to 200p range on a multi-year view.

For investors who appreciate and can stomach the risks, I therefore think Tullow merits starting to accumulate – and at very least, deserves following closer. Buy. "

it's worth keeping an eye on the bond market trends for TLW, they are showing a good turnaround in confidence.

https://www.boerse-frankfurt.de/bond/usg91237aa87-tullow-oil-plc-7-18-25
https://www.boerse-frankfurt.de/bond/usg91237ab60-tullow-oil-plc-10-25-21-26

Currently it's between Civitas, Tullow, Wickes and Avon. Civitas has a market cap of about £675m. This would be equivalent to TLW at about 47p so it's pretty close, i'd expect there to be a step up in buying pressure if we go above that. Stretching above that for safely staying in is Greencore with a MCAP of £720m.

We can be sure it'll be volatile until then. Note, Capita was a cert to drop out of the FTSE 250 at the beginning of this month, good results came in and the shareprice was squeezed from 35p to almost 50p in days.

Funds will have run their numbers so would generally have already hedged it moving out, it's the scenarios when there is a sudden shift when you see a squeeze. In this case, running the numbers on friday it looks to be out of the FTSE250 (albeit most likely temporarily). If this doesn't happen then there could be a buying squeeze. Either way, it doesn't make much difference long term. The sell off does seem overdone IMO so back in this morning.

It's more the external factors of tracker funds having to hold shares. This can cause shifts in the share price as we saw three months ago due to the buying pressure from the last minute inclusion, was a rapid squeeze. As TLW market cap was at the bottom of the FTSE250 there will be an assumption that it'll drop out. This rally may be a bit late, but it'll put the cat among the pigeons when deciding who's in and who's out. Will certainly make the next few days interesting.

It seems like there has been a lot of pressure to knock this out of the FTSE250, possibly from all those who were stung by its last minute inclusion in the last round.
Although MCAPs were taken on friday, it'll be interesting to see how it plays out if there is a significant step up over the next few days. Will put a squeeze on those who have assumed it'll drop out.

India are the third biggest consumer... but are dwarfed by China and the US.
Below is the breakdown in barrels consumed per day (and world share %). Shutdown will have an impact, but a booming US and China consumption would balance this.
1 United States 19,687,287 BPD 20.3 %
2 China 12,791,553 BPD 13.2 %
3 India 4,443,000 BPD 4.6 %

https://capital.com/eia-raises-short-term-oil-price-forecasts

I do query why shorters didn't close out their positions further when this crashed out a few days ago. There was a steady reduction beforehand.

Do you think that the Saudi cut in production out of the blue may have had a last minute impact to discussions? Certainly reduced downsize risk to POO with their very open support to shore up prices.

Pictet down another 0.15% to 1.32%...

With multiple shorters closing out their positions.... will we see a squeeze this week?

Brent futures rising strongly with spot price. De-risking TLW and future FCF. I'm sure this will ruffle a few more shorters to think about closing their positions further. All IMO

Today was quite the surprise with the cut in production and rise in POO, however it does raise concern on how much they predict demand to drop over the coming months. The tapering off of futures from their peak today seems to suggest some slight over excitement. It’s good to see alignment within OPEC+ to take action when needed though

Thank you Slift for sharing all your thorough research.

Regarding these production decline figures, are we aware of any planned/unplanned maintenance or shutdown window in the period? I'd have expected a more linear decline then the interpolated figure indicated for Q4.

Quite a swing today, hope not too many were rattled out too early. Marshall Wace used the opportunity to reduce their short further again (down to 0.79% now).

Agree, all conjecture until put in an RNS... but the article no doubt triggered a few buy fingers

https://www.streetinsider.com/Hot+M+and+A/Apache+%28APA%29+Explores+Potential+Bid+for+U.K.s+Premier+Oil+-+Source/17076006.html

But could just be them poking it with a stick...