Member Info for Slift

crazyinlove,

If you expect this to go below 24p, do you also expect Eco to go below 18p?

Yeah, your truck needs some work.

lol.

A medium sized aircraft burns c. 3400 litres/hour of jet fuel.

A medium sized car (Let's say Audi A4) burns c. 9 litres/hour of gasoline.

Random facts but yeah, you need 380 Audi A4s to replace a 737 aircraft, assuming jet fuel and gasoline are equivalent (they're not).

GLA.

"Although there are less planes flying, I would imagine some of the decreased consumption would be offset by additional road trips / staycations."

It's a bit more complicated than this. Crude oil is a combination of different chains of hydrocarbons.
When you refine this through a distillation column, you tend to get different chained hydrocarbon that are separated with temperature.
Jet fuel, Gasoline, Diesel, Coke etc.

I think we can all see that there is an increased consumption of Gasoline - This can be seen with Gasoline inventories. There has been a draw on the gasoline inventories for the majority of the weeks since May, with an increase on the odd week.

So what's really happening with crude and jet fuel?
Refiners will reprocess jet fuel to increase the hydrocarbon chain (in essence turning jet fuel into gasoline). This added process step would obviously increase the cost for refining for a refinery, but in turn the refinery will be able to maximise the production of gasoline to sell from the same number of barrels for crude.

The above is the likely reason why gasoline inventories are always been drawn on, and why crude inventories have mostly increased (with the odd week that it's been drawn on).

So yes, you are right. Decrease in jet fuel usage is offset by gasoline usage (with the jet fuel being processed into gasoline). But crude supply = crude demand currently. Until the demand for crude increases significantly to offset the supply of crude, oil prices will stay depressed.

Petrol price where I live is now at 110.9p (at Tesco). This was 98.9p at the lowest point in April.

You're an idiot. SouthSeaBreeze is being factual.

Hi Careful,

I do see some upside here, but not quite as much as what others see, nor what these paid reseachers see. I disagree that the current share price is priced to go bust.

Hannam & Partners' report with their NAV is almost always overestimated by a few folds. Just remember that NAV doesn't necessarily mean that's what the share price should be.

I don't want to go in depth of their balance sheet analysis, but this is something to note:
"We have updated our estimates of capex for 2020 and 2021 to only include committed capex. We now forecast US$53mm for 2020 and US$60mm for 2021."
The majority of this CAPEX was spent between Jan --> April i'd assume.

Regarding the main note, they are expecting long sustained production. I think the key note here is:
"It will be important to see the water cut remaining stable to gain confidence in the longer-term production of the 7z-well. "
I'm very skeptical of the above. I think maybe in the near future, well 7z may be a write off. I think this is what i (and probably a lot of other people) are worried about.
The viability of economically producing from Lancaster is very very questionable. I don't think that the report goes in depth of what's really happening with the FB. It's mainly focussed on production and fundamentals of the company. I completely agree that on fundamentals and production alone this company is undervalued. But in terms of future prospects (which is what shares are priced on), there are a lot of uncertainties that need to be resolved.
If some of these main uncertainties isn't clarified before the technical review update, I certainly will not be invested for the technical review update.

Slift.

Hi el19,

Gonna put it bluntly and say you and "the lads" are deluded.

Could you please explain why you and "the lads" think that this stock will be valued at 16p by Q4 and 40p by Q3 21?

Hi Beetham,
"Slift, What do you think about this from the final circular ?"

Don't think anything of it really. Highly doubt that the bond will be converted into shares (or at least at the current state).

Ofcourse, there was only two explanation to the results they had released. Debt increase or commitment reduction. It's also strange that they reduced commitments. Tullow indicated that the next reduction was in April!

But good to know. Tullow is in a much better position than first thought with the trading update :).

GLA.

Nice one, just saw that they've uploaded the final circular.

Borrowings hasn't increased then. Still at $3255m, with cash in bank at c. $255m

"TLW should have made a big acquisition for that $700mn proceeds."
Could even be addition to stake in Ghana from Oxy.

@Cesna,
"The Bonds are issued at par and will have a coupon of 6.625% per annum payable semi-annually in arrear on 12th January and 12th July in each year, with the first interest payment date being 12th January 2017. The Bonds will be convertible into fully paid ordinary shares of the Company (the “Ordinary Shares”). The initial conversion price has been set at $3.52, a premium of 30% above the volume weighted average price of an Ordinary Share on the London Stock Exchange between opening and closing of the market on 6th July 2016, converted at the prevailing USD:GBP spot rate. The Ordinary Shares underlying the Bonds represent 9.35% of the Company’s outstanding ordinary share capital."

Hi SteveE60,

I think it's very unfavourable conditions for Petra currently. I'd like to believe that there are some interest in Petra's assets currently. I wouldn't be surprised if Petra were in communication with potential buyers of assets. But as I said, very unfavourable for Petra, so i'm not too sure if the board or Rothschild would even consider the lowball offers being offered currently for their assets.

With lockdowns and social distancing, most weddings have been called off for at least a year. Diamonds play a big role in this market for rings, necklaces etc. We will see depressed diamond prices until things recover on the COVID and the social distancing front.
But when social distancing does end, there'll be quite a lot of people getting married (those who have had to postpone). I see the demand for diamonds to uptick significantly when this happens.

I don't know how much longer Petra have got before admin, but like DC2007 said, there's potential for Petra filing for bankruptcy should bondholders not extend the Forebearance Agreement past 31st August.
It's likely that Petra are looking to get at least one asset sale (Williamson or Finsch) through before the end of this year (or that's what i'd think).

Regarding eatstocks' comments:
"Their lenders seem happy to push their repayments and are therefore not too worried on the long term, these guys are there for the long run. They don't want the loans to be paid off they won't a steady supply of interest payement."

I disagree. Lenders don't want their money being used for interest payments. This basically means that the company will keep going into debt and at some point, all lenders will lose out.
Lenders will only be willing to push out repayments and have a steady supply of interest payments if the company can sufficiently produce free cash flow to service these payments.
Sooner or later, Petra's lenders will break and take Petra to admin (when they feel like they'll never get their money back).

Petra's mines (other than Williamson) has been operating at 100% operating levels for 2 months now. I think Petra really needs to find a couple big diamonds to both increase confidence in company (both from lenders and investors) as well as to provide some sort of near-term liquidity (with the sale of these big diamonds).

All IMO. Slift.

Hi CaptainSwag,

Yes, I agree that MAJOR support and resistance levels are important.
I'd imagine the 7.92 resistance is the one that Swazers has put down as 7.685p. These values obviously differ based on chart timeline. This resistance is either the 200MA, or the "top" that the SP failed to break in the past.

The 9.6p resistance is the gap fill resistance between 9.5 and 12p.

Breaking these resistances depend on RNS and newsflow.
It's definitely worth considering, but not something that you should stick by (unless ofc you're daytrading).

Analysis of that stupid 4h chart:
- Gap to fill between 9.5p and 12p

- First Resistance: 6.375p
- Second Resistance: 6.815p
- Third Resistance: 7.685p

- First Support: 5.52p
- Second Support: 4.48p
- Third Support: 4.14p

- EMA21 above EMA50, a little bullish.
- EMA21 and EMA50 both still below EMA100 (and EMA200). Needs to comfortably pass 6.3p (EMA100) and 7.6p (EMA200) for a positive uptrend (Hasn't even included EMA200 on his stupid chart).

- The trend lines are stupid to even include in that scale of a chart.

Conclusion:
Absolute *******s.

I'm not too sure the deal that TLW has made with the RBL regarding the $300m bond payment.

But the debt that Tullow has to pay and the liquidity reduction for 2021 is:
- $300m bond July 2021
- $422m liquidity reduction (as opposed to payment)

I've been thinking about the current liquidity that Tullow has.
As at May 31st, RBL borrowings were $1505m/2188m. Total borrowings were $3255m. Which meant that at this time, the liquidity from RBL was $683m.

As at 30th June (from Trading Update), Tullow has a liquidity of c.$500m, with net debt of c.$3000m.
To me, this sounds like Tullow has withdrawn from RBL c. $180m between 31st May and 30th June, taking borrowings from RBL to c. $1685m. This brings total borrowings to c. $3400-3450m.
With the net debt being c.$3000m, Tullow must have c. $400-450m cash in bank.

Now regarding RBL payments, at $1685m borrowings from RBL, Tullow will need to pay back c. $340m by 2022. Or $130m by April 2022, and $210m by September 2022.

2022 repayments:
- $650m senior note
- $340m RBL (Although this RBL can be repaid whenever between now and then)
- At this point, Tullow will have $0m liquidity.

Note: With increased borrowings, interest and finance costs will be higher. E.g. The $180m borrowing would come with c.$11m interest @ 6%.

I think Tullow does have room for negotiation with the RBL. I'd imagine these negotiations would be:
- Extend RBL maturity from 2024 to 202x.
- Increase liquidity, or total amount that can be borrowed. At the moment, it is $2.2b. In 2022 (assuming no further borrowings and the above $340m repayment is made), it will be $1350m. So there is an opportunity for Tullow to increase this amount back to $2-3b, and using the liqudity from here to pay off the $650m senior note.

Any comments from anyone?

Ouch.

https://www.cnbc.com/2020/07/31/chevron-cvx-earnings-q2-2020.html

BTFATH1,

I've already made an investment here. I don't plan on buying more.

yeah bigsmoke, what are you on about?
Petra just sold some assets for $300k to keep them going :')

Right now, 6p.