Member Info for Slift

Like for like sure.

But cash, abex and opex will eat into it.

Should have said "through 2022".

Just catching up.

Still have no idea where people are getting $700m FCF for 2022 lol.

Expect FCF to be around $300-400m before refinance/acquisition costs. That's assuming that oil stays above $80/barrel for the year ofc.

As I said before Kraken production from natural decline is a big hit. ENQ flagship is now producing less than 50% of it's estimated plateau with still no drill targets for 2022.
I expect a significant decrease in 2P reserves over 2022 (not accounting for Bressay FDP or any other acquisitions).

Same old Enquest.

All IMO.

Supercooper,

What's wrong with it? It's within expectations, maybe not yours.

My forecast of 68k for 2022 included for additional stake as well as TEN wells coming onstream in 2022 (which now we know won't happen as no infrastructure).
Without the TEN wells, the production in TEN (or Enyenra) will continue to decline - hence the given production guidance by TLW.

Nothing wrong with the forecasts. TEN will continue decline in 2022 with no options to arrest the decline.

From TU:
"Two strategic development wells are to be drilled in the Ntomme riser base area and an additional well is planned in the Enyenra area in the second half of the year. The JV is also investing in the infrastructure required to allow these wells to be brought on stream from 2023."

Basically, despite there being 3 TEN wells drilled this year, none of them will be tied back for production until 2023 due to lack of infrastructure in TEN. The manifolds in Ntomme and Enyenra are already utilised by existing wells.

But in 2023 when TLW does build on the infrastructure, expect there to be 3x wells immediately added for a significant boost in production from TEN in 2023, with further wells drilled in 2023 for TEN. 2023 production guidance will see a MATERIAL jump.

I think a lot of people here will be disappointed with the update.

It will be a positive/neutral one, but FCF forecasts of close to $700m is quite laughable.

I see marginal improvement to performance in 2021 in 2022. Although, I'm not sure how much of an improvement that will be on the balance sheet.
Nonetheless, oil price will help all oil companies this year.

2023 is when I see some significant upside to this company (unless ENQ messes up again). Wonder how many shares are going to offered this year.

y11-shx,

You're just an idiot mate.

antonvb,

You're mistaken there.
If you know the potential of PEL90, you'd understand.

I believe Tullow had (or was supposed to) done a 3D survey on this license in late 2021. It's possible that either 1. As you say Tullow didn't have cash to commit, or 2. 3D survey wasn't very promising.
But with $250m FCF, it's no excuse to not do a 3D survey. These surveys are very affordable.

But what I want to know is, even if the 3D survey wasn't very promising, why exit?
Total is drilling Venus-1 currently too. If that is successful, along with Shell's Graff-1, then there is the potential for Tullow's PEL90 license to become the Kanuku or the Orinduik of Namibia.

I see this exit as a big mistake if Venus-1 strikes oil.

Happy,

Yes, it's going good thank you! Though I will be looking to transfer majority of my oil investments to other sectors in the next 6 months or so. The only oil companies I currently hold is Tullow, and a small holding in Enquest.

I don't think you're right there on Rahul. I think he's done a good job. I agree with you that the existing assets or fields in Ghana is mature. However, the new developments in Jubilee and TEN under the ongoing strategy will replace the reserves of the maturing portfolio. The drills are targetted at reservoirs that has not been tapped previously (Jubilee SE, Ntomme Far West, etc.). These fields will be prime and will look to plateau over the next few years.

I first invested in Tullow during/after the COVID crash. I know exactly what position Tullow was in during times of ATL oil prices. Tullow has come a long way since then. From bankruptcy, to a stable company that can service debt and growth.

"Shell hits oil and gas in Namibian offshore well"
https://www.reuters.com/business/energy/exclusive-shell-hits-oil-gas-namibian-offshore-well-2022-01-25/

"In January 2022, Tullow also exited the PEL 90 licence in Namibia, further optimising its portfolio."

Why?

Plans for TEN is probably the single most important information in tomorrows update.
The entire capital and debt structure for Tullow currently is dependent on TEN and Jubilee.

TEN December production has further decreased as expected due to lack of CAPEX in Enyenra.
Not to worry if Tullow's drilling plan early part of 2022 is within Ntomme.

With 47.1 - 54.8 % stake in TEN, this field is still a wasted opportunity (as it stands).
A SINGLE, successful and a high productivity production well within this field will increase production (initial) by close to 5k bopd net to Tullow.

GLA.

Hi oiluser,

Yes, 65-70k guidance or 68k bopd average is what my estimate is based on pre-emption rights completing.
However, Tullow doesn't have access to the additional stake and production yet.

Without the additional stake, I have 63.5-64k bopd average. The additional stake will add 6k bopd average pro rata.

It's likely that the production guidance will have a large range to start off with, maybe 60-70k or 62-72k or so.

But what's important is that the production guidance is an INCREASE on 2021, and by more than a couple thousand barrels per day. That's all that matters.

"A. I can’t speculate on the timeframe at the moment, but we are keen to keep the momentum on this to reach completion as soon as possible. We would be obliged to release this when it happens."

It'll be interesting to know when this transaction will complete. There were several approvals required for this acquisition and the transaction is complicated further. Essentially change of stake from one operator to 4 others following pre-emption.

I've read through the prospectus for this, but unable to find any information on expected completion. Hopefully be Q1 2022 so Tullow are able to account the transaction in FY21 results.

January2,

Yes, impairment reversals will happen also due to an upgrade in oil price assumptions/forecasts.
I'm not here to argue, I simply posted my opinions to romaron's post.
I have a holding here currently.

SaveMore,

Do you know how 2P reserves are determined?

Hi romaron,

Not sure if we can compare Mariner to Bressay or Bentley as they are both undeveloped.
Kraken on the otherhand.. will mostly be unaffected from Mariner downgrade. There is little evidence to suggest a reserve downgrade for Kraken just because of a downgrade of a nearby field.
Mariner is a complex field, and if there was a STOIIP downgrade and if Kraken shared similar characteristics of the complex field, then it would be understandable for the downgrade to affect Kraken.
I believe it's just a downgrade to RECOVERABLE reserves for Mariner, due to the complexity of the field. As opposed to a downgrade of STOIIP.

But that's not to say that Kraken will not suffer an impairment/write-off or whatever you want to call it. I've mentioned this before as i'm most concerned about Kraken rather than Magnus.
It's hard to say without real production figures (Enquest is indirect about production figures and I haven't had time to work out using OGA data for all of ENQ's fields), but following performance issues in 2021, I'm quite confident that there will be an impairment or write-off to a number of Enquests' assets.

The addition of GE field will absorb some of the impairment from other assets, but the question is: Is it enough?

Looks like the only loser today is BTFATH1.

The problem with Enquest is.. any added value gets taken away by operational issues or field performance.

It's a shame really, I think Enquest needs a new board and a new strategy.
A long term plan can really help refinance debt over a long period of time, allowing Enquest to actually use CAPEX to improve performance and make more money.
Even after a year of good oil price performance, Enquest is still fighting against debt, when it should have really been sorted last year.

Enquest now has a stake in 3 major fields. Yet due to lack of CAPEX and lack of mitigation by the operations team, 66% of the fields are underperforming. Or at least IMO.

Luckily, I'm not a LTH here, but follow Enquest closely.
It must be really frustrating for all LTH here, it's been the same story each year for the past 3 years.
Will Enquest ever change to become a company where LT shareholders can actually see appreciating value with their investment?

It's all about demand now. Supply cannot be restricted any further, with OPEC increasing production each month and the rise of oil rigs in the US looking to increase production of shale.

We need a significant but stable shoot up and growth in demand that will outstrip the supply for long periods. If there's a time for the world to have growth in demand, it's now.

EIA STEO Forecasts:
2022: $75/barrel average
2023: $68/barrel average

I think final approval of sale of stake from the GoK and other relevant bodies will be by June/July.
With FID taking place soon after.

Announcement of sale of stake and strategic partner will require shareholder approvals and other conditions being met. Expecting the intial announcement to take place in Q1.

Ofcourse, this would be the most optimistic and realistic scenario. But never know what hurdles there are.