Member Info for Slift

Pecten11,

I said I had "marked" on the diagram. The only change in the diagram are the lines drawn by me - to show how it CAN be connected to another perched pocket or aquifer.

I cba to find where the original diagram was from sorry.

Here's a diagram HUR provided (that I have marked) to show how the perched water (if perched water) COULD be connected to the other perched water sources (increasing the volume of water) or the aquifer.

https://gyazo.com/fe025d8c115e6e9d9ac609e08f491249

I think for the time being, there isn't enough evidence to prove anything. Just ride the wave and hope that the risks to productions are managed and minimised.

bransonbull,

I was only questioning the other explanation.
Regarding the temperature difference - If the perched water source is connected to the aquifer, then this explanation is also invalid.

"trice has repeatedly said it was perched water. He is the expert with the data. If people are coming up with anything else you really have to question their credentials."

I'm still questioning Trice's explanation for perched water.
I believe one of his arguments for the fact that it is perched water was the following:
"the observed water trap behaviour immediately after restarting production following a shut in"
"start up has high water cut which then dimishes over time"

A bit of contradiction from management now don't you think? As management have now provided a "stabilised" water production rate. Or in other words, the water cut in 7z will not diminish much in the short term, but will be constant.
We will see the watercut diminishing over a long period of time (if it is in fact perched water being drained out). But for the time being, his comments regarding "very high water cut from start up --> dimishing" do not prove that the water is from a perched water source.

Unusually high volume today (in comparison to other similar stocks), and no known reason behind it. Does make me wonder...
Immediate threats that come to mind:
- Issues with Gov regarding sale of Uganda?
- Ntomme-9 well

On the plus side, US stimulus announced later in the day. Should "hopefully" give stocks a boost tomorrow.

Thanks Longish.

Preliminary financial information for H1 (cash flows, revenue, net debt) will probably be included in the Trading Update. I'd definitely like to see directors buy to show confidence in this stock going forwards

In the meantime, the current share price presents a great buying opportunity.

Am I right in saying that it's a closed period for director buys until interim results on 9th Sept?

The window for director buys is very limited it seems like!

Lmao, I was never short.

You were the one calling in 3p. Where's the 3p mate?

Still here oilheadgame.

Have you bought back in yet?

Fandg2,

Yes, I suppose I was a little optimistic expecting it with this update.
Thought it was possible to provide a production guidance now that the company believes that they have "stabilised" oil and water production from 7z.

But no worries. Just more to look forward to with the interim results.

Ofcourse Dickbat, happy with the RNS.

I wanted to see the company to provide a production guidance for the year. Kind of disappointed that they haven't and saving for after tech review (September).

GLA here.

Branson,

Watercut overall is 30%, not 24%. It's up slightly from when well 7z was shut in back in May.
But the rise in watercut isn't something to be of concern as minimal and manageable.
AM at 69.5% capacity.

Dickbat, yes, I've bought a week or so ago.

Another positive:
- Water and oil production has "stabilised"

Overall positive.

Positives:
- Interference sorted
- 17k bopd
- well 6 on natural flow

Negatives:
- uncertainty of production (no guidance)
- watercut circa 30% overall

"I hope so but just wondered if the hedging is included in the FCF figure...."
I'm also unsure of this.

If $35 breakeven for both unhedged and hedged (e.g. taking $22 FCF from hedges) - Expect FCF Q2 (+)$70-80m
If $35 breakeven for just unhedged (e.g. taking into account $57 from hedges into the breakeven $) - Expect FCF Q2 (-)$20-30m

A lot to risk on a company that has failed to meet covenants...
6m shares next week?

US Stimulus Phase 4 deal to be introduced on Monday.

Should prop up the markets a little early in the week.

GLA.

cluelesstim,
"Any guess why RBL seem to be drawn"
I'd take a guess to say that the facility was drawn on for the RBL re-determination in March. E.g. to show that the company has the cash in bank for financial commitments for X months.
Reasoning:
31st December: RBL facility commitments @ $2400m with borrowings of $1345m. --> headroom of $1055m
3rd April: RBL facility commitments @ $2189m following amortisation with borrowings of $xm --> headroom of "circa. $700m"
So put the two together:
$1345m + $160m borrowing = $1505m (as per circular)
So 3rd April: RBL facility commitments @ $2189m following amortisation with borrowings of $1505m --> headroom of $684m.

"And for capex if i recall correctly it was for the full business, not just Ghana."
I think $150-200m CAPEX would just be running the company to the ground. I mean Tullow's non-operated portfolio CAPEX for this year was $80m. You can't maintain high production rates at Ghana with minimum CAPEX.

"Also curious if TLW can buy back high cost bonds for low cost RBLs in the current market i,e, buy the 7% bonds/notes in exchange for 5-6% undrawn RBLs, assuming those are the rates? Easy interest saving exercise."
I don't think they can pay off bond or senior note until maturity date. I mean bondholders wanted the interest for X number of years when the bond was issued.

Cluelesstim,

"2021 - 300mn converts due, 2022 - 650mn Senior Notes due.
$1bn proceeds can easily pay off these and post that there are no maturities until 2024."

Not quite.
As at 31st May 2020, the total borrowings was $3255m. Here's a breakdown:
2021 bond: $300m
2022 senior note: $650m
2025 senior note: $800m
RBL: $1505m

Of the $1505m RBL, The "final" maturity (November 2024) is $711m. Here's a breakdown of what Tullow HAS to pay back:
2021: $0m
2022: $161m
2023: $422m
2024: $922m (including the final maturity of $711m).

"And for capex, if you listen to the CFO the min capex needed to run the business is 150-200mn."
This is likely to be just CAPEX for Ghana.

"would need additional exploration discoveries or at least a thrill of the chase"
As above, comes at an expenditure for capital exploration projects. Each drill is circa. $20-40m depending on target at 100% interest. That's on top of contract for the rig (which would be OPEX).
Tullow and partners are in talks regarding Guyana - I believe potential drill locations have been identified, but not confirmed yet. They will also be discussing the development of Jethro and Joe wells. I read somewhere that the Jethro well was promising for production due to reservoir pressure, temperature (and as a result, viscosity/mobility of the heavy crude).

Why do you think you're onto something?
Any explanations or just a gamble?