Member Info for Megla

Lol Kraken, there’s no way you own any of the bonds. The minimum buy size excludes ten bob gamblers like yourself.

Tell that to those that bought over £2 on the basis of the development assets in Uganda and Kenya taking production up to 150kbpd.

The deal was essential, but all the name calling in the world doesn’t take away that is was at a fire-sale price. Now run along, I know you must be bored with school being out, but maybe leave these boards for the grown ups.

Tony, this a nonsense comment. Why can’t you just accept that the Ugandan sale is at a fire-sale price? Assets on the balance sheet will be wrote down, this is even after the huge impairment at year-end. All the dodgy analysis in the world won’t change those facts.

The transaction was required due to the business being a going concern, so was absolutely to strengthen the balance sheet. It’s okay to be bullish on the company and still accept the deal for what it was.

The fcuk you getting your knickers into a twist about, Tony? Maybe it’s because you’re so bad at math.

Extending the maturities of the RBL makes sense, the amortisations schedule is still $200m every six months and additional 2p reserves help in those discussions, hence a partial sale of Kenya would make more sense.

Maybe you’re confusing yourself with the six monthly redetermination, but given you’re so emotionally attached to the company it isn’t surprising you’re getting muddled.

Personally, I’d raise new equity as soon as possible and put those concerns to bed.

Obviously tullow can’t sell all of Kenya now as they’ll need the 2p reserves to extend the maturity of the RBL, thus raising new equity gets rid of the going concern so they can negotiate a partial sale with a better hand.

Tony, where do you get your calculation for the interest saved over two years? Average cost of the debt is around 6% so more like $60m over two years.

It is a distressed sale, but if you’ve bought shares in the last month it’s great news, not so great if your one of the unlucky ones that bought before the downturn.

BTFATH1, the impairments have absolutely nothing to do with fcf.

Next RBL redetermination is in September, not April next year.

Maybe do some research on the company you’re invested in.

The market is going to get very ugly when the US wakes up.

BTFATH1 thinks Tullow will RISE the day after WTI settled at groundbreaking lows, lol.

With the inevitable breach of covenants it’s difficult to find a reason to buy, unless you’re a trader after a fast few quid of course.

I just can’t see ARCM making this easy for Premier if they do need to waive covenant tests, would they push the company down the debt for equity route, then close their short with equity presented to it in the restructuring?!

Thoughts?

Well said SK.

Agree, but if the agreement doesn’t fall apart due to countries cheating **Russia** then the duration of the cut is far more important than the fuzzy headline numbers that are being touted around.

Betrayed, do you think the warrants exercise will be repeated if covenants are breached? Or would ARCM push the company down the D4E route with the backing of other lenders?

SK, personally I think it’s important to still pursue the BP assets, these will be tax free barrels which will help massively with the declining production base and debt metrics. Not sure how feasible it is to progress in the current market, but I still think they should move forward.

Hedges do drop off which is why I think they’ll likely breach covenants at some stage.

When is the outcome of the court case expected?

I’d like to buy a few but isn’t there a prospect of a placing that would massively dilute shareholders?

Also, there’s a real risk of breaching covenants, do you think ARCM would be happy to waive covenant tests if required? I get the feeling the company and its main creditor aren’t on the best of terms.

The cuts starting in May are logical from an operational point of view, I’m sure it takes time to shutdown production, but from a market balance perspective if demand really is down around 25mb for this month then we’re going to end up with additional half a billion barrels in storage by the end of April.

As lockdowns ease in May & June (hopefully) the market might start to balance somewhat, but the next few weeks look very tough from a price perspective.

One positive is that shale production is going to drop off a cliff, but getting back to reasonable oil price seems a long way off.

Retail bond best way to play Enq imho, 150% return if paid in full, no point buying the equity.

Very much so, but given the scale of the demand destruction it would certainly be foolish for them not to come up with something. Personally, I’m in the camp that it will happen but given I’ve sold 25% of my stock here, I guess that means I’m only 75% certain.

Tullow’s assets are far superior to PMO, mostly oil and very long-life. PMO will likely breach covenants this year, even assuming oil back to around $40/$45, so you’re essentially betting on creditors waiving covenant tests.