Member Info for Tornadotony

https://www.macrotrends.net/1380/gold-to-oil-ratio-historical-chart

We have hit 30 barrels of WTI to one ounce of gold. Something is going to give in a few days time.

Support line is holding. This is great news. The gap to the intra day trading low was 48.6-48.7 which was spot on and we got a bounce off it. We may be stuck 50-52p range all week but I would take it as strength with oil price under pressure.

Tullow doing okay. Target remains a close above 50p.

Held at 48.65p.

consumption became conception somehow?

Significant numbers of people have recovered from milder infections and developed immunity. Vulnerable patients with underlying conditions are at high risk. The shut downs of cities impacts diesel and gasoline use but a lot of conception of oil products continues. China will have stacked up oil reserves for the holiday and the price drop is re-ordering the replacement stocks in weeks ahead. By then a lot more will be known. Tullow has 40% production on a $56 floor and is closed 65% for maintenance at the later part this week as they improve gas take of issues on the topside in Ghana fields.

Just to clarify that the free cash flow adjustment on the write down is also sharply reduced from $350M to say $250M. The company has guaranteed 150M at $60 per barrel and at $65 this would be FCF at $250M. Hence why there is no price cutback on the drop to 75,000 barrels per day in what I said before.

https://www.offshoreenergytoday.com/karoon-tullow-to-spud-first-well-in-z-38-block-off-peru-in-2020/

To Hawkey and others with similar concerns,

Tullow had very high initial forecasts coming into 2019 and a number of exciting drill prospects. The oil price was also higher in 2018. Consequently valuations became rather lofty at 235p. The company gave a lot of hope on those wells and the kick back to 165p was taking out all the Guyana value. It was punished another 20p afterwards as recovery from earlier production reductions was not on the cards. Fresnillo in the silver miner sector was delivering similar disappointments and was getting a 1/3 knocked off and I suspect other UK commodity companies missing results do get smacked down hard. Centamin saw a vicious drop with poor results early in 2019. So the base case price of 141p-145p is the real starting point after the $50M drop in FCF for the close of 2019.

Since then the company valued its assets down $1.3B after tax relief. The share price was valued $2.6B approximately and this gives $1278M share valuation afterwards and this takes us to 69.9p share price. Since then oil has dropped $5 per barrel which is $100M drop in valuation according to Tullow. This gives a share price of 64.4p. We know Carapa was valued at zero but the write down on all wells was around $80m so that gives 60p. The remainder drop is probably speculation on future oil dropping to $50 Brent allowing for Tullow hedges to kick in. The upshot is that the kitchen sink has been thrown into this. I believe 56p or below is a Tullow buy.

As for the future we have to see what it brings. The Kenya blocks may just sit there and nobody buys them but the banks know that Tullow has a good $750M-$800M of value just sitting there. That itself is a confidence measure. We may soon get a second value boost from Uganda. To end up with a route to market with 20,000 barrels of oil for 20 years has a future 2P value of $1100M. Guyana also does not have a value of zero and Ghana oil fields is probably above $2B despite current issues (245M barrels reserves $9 each) . Hope this all helps and all the above is my opinion of course but I share why I am staying with it and know 2 good oil strikes and this share moves up quite a bit as it has done in the past. Tony

Barchart confirms 639.8 as a resistance line. Failure to break through could retest 624 support line.

Centamin on a slight pull back to rally next week as it reports. What we do not know is the 2020 spending plans. Do they build a new mine when the sun is shining on gold. Do they build a solar farm to cut down on diesel use and take some more carbon friendly measures where they are using a percentage of renewables. Will they fit platinum hydrogen cells into big vehicles and use less diesel on those equipment? Overall they could spend all their spare cash but the business model has growth and reduced costs of production in the future. In the short term the SP may go down but later on it powers up to new highs against a flat or slightly lower gold price environment.

I for it.

I had expected to see a small rally to high 640's and the market has not given us that in awhile. Not long for the report that would in my opinion deserve the share to be on that mark. Gold and silver have held up well in January and given Fresnillo a good start. It all can change of course in February and March but I would be nice if the company was get a median price against expected earnings.

The support line has an upward gradient. Next week 52ish. By Mid March 65p. Support lines can be breached, however there is hope if events allow it to be held.

Support line held with uncross.

The resource is a low production cost source. The opportunities to buy such resource in such amounts is becoming more rare. It does save another company exploration hassle as it is known find. It demonstrates to the market of the value of the East Africa assets. The two together wipe out half Tullow's debt. The Ghana oil field and other producing wells are worth nearly $3B+ on a non-fire sale basis. We still have a couple of shots at more oil and the Guyana licence blocks.

The Chinese are doing the right things to contain the epidemic. In some regards having it over a holiday week that starts today is a huge advantage in slowing or stopping the spread. Oil is stabilising as China will still be using lots of oil. We need to see 50p recaptured by the close.

On the support line.

To back up the truck!!!!!!!!!

to use their share of selling Kenya blocks to buy all of our Uganda asset or they just buy all of Tullow for $800M odd less then they planned. Company is now very ripe for a bid in that case.