Member Info for Megla

Not sure what your point is then? If you understand the concerns about the debt, why are you surprised when people mention it?

Oldfatprop,

I would be surprised if both Total and CNOOC haven’t been running the numbers. Yes they get the debt, but take out the daft G&A costs and half the interest rate on the debt then you’ve suddenly got a company making half a billion dollars a year of FCF at $65 oil with Kenya, Uganda and Guyana exploration licence as potential future developments. Doesn’t mean they’ll make a bid, but as I say, I would be surprised if they haven’t run the numbers.

Bigbear, the debt is a problem as we don’t currently have a clear strategy on how it will be paid back. That might changed tomorrow, it if doesn’t then the company should be put up for sale.

Good take on it, Canary. Dividend yield was crazy until they cut it yesterday, something like 25%. Will be interesting to see whether others follow suit with big capex cuts.

Sure Yuri, if you say so.

Gotta be hedge against the debt, especially with rumours circulating about a potential takeover.

Who doesn’t?! :)

Well, cutting capex, which means production will fall. I expect more will follow.

Got to show you’re serious if you want to bring someone back to the table.

It’s already having an impact on shale though, Oxy and Parsley have both released notes saying they’ll be cutting production.

Go on then BTFATH1, please explain why NAV is useful in valuing an oil company when the oil in the ground isn’t included in the calculation?

Capex*

My mistake, but a step closer to FID isn’t exactly a game changer is it? Current we don’t have the cakes to fund the development, nor do we have a deal to farm down our stake. I get that you want something to happen, but it isn’t a game changer.

Looks like curtains there. Tullow should put the for sale sign up so the sale thing doesn’t happen here.

Pointless discussion, NAV is absolutely pointless when trying to value an oil company.

A game changer would be that our development is progressing, not someone else’s. I can’t work out if you’re overly optimistic or just deluded.

Saudi have just said they’re supplying 12.3mbpd in April, basically they’re flooding the market. Least everyone is f**ked, not just Tullow.

More than 16p

BTFATH1, you really don’t have a grasp on what’s happening do you? The credit line is going to be cut at the end of the month and we have zero FCF. With the amortisation schedule of the RBL and depending on how much it reduces by we’ll be out of cash by probably mid next year.

Yes the company will try and sell assets to stay afloat, but there’s no guarantee we’ll get a good price or even a buyer.

We do have some great assets and as I say, it’s better to sell the company to the highest bidder than risk equity being wiped out due to prolonged downturn in the oil price.

An offers certainly more preferable to going bust

Matt, you’re also an idiot. Maybe read up on covenants and the 700 page bond prospectus.