Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Agreed slift. If we could achieve a $450m to $500M sale price with upfront payment terms or structure over no more than 3 years I’d be happy. However I have serious doubts based on the perceived weakness hence my question regarding RI and my willingness to participate. TLW needs to get its balance sheet and debt in order but I have no doubt that a Guyana and Suriname focus can make TLW shine again.
I think it all depends on progress with Kenya. However I would participate in the rights issues as I’m sure would most existing shareholders with those not taken up being offered to existing II’s etc. I don’t think it will be necessary but certainly would shut the naysayers talking about witched earth scenarios and TLW going but is 6 months etc. The nonsense spouted on here recently is ridiculous.
Anyway from business daily today below. I think we will hear in Kenyan by end of June.
The firm now faces discounted bids for Kenya, going by the price it accepted in Uganda even though it maintained that the deal had no direct impact on its view about Kenya’s farm-down.
“Tullow expects to receive bids from potential buyers in the coming weeks, and the size and shape of the deal will be decided at that point. We will update you on deal progress in Kenya as soon as we are able to,” the firm said.
Kenya’s Early Oil Pilot Scheme (EOPS) remains shut down,
BT from memory Tullow has valued Kenyan assets at circa $700m. Given the oil price environment and the near term or upfront nature of payments TLW will be seeking, surely our hand will be significantly weakened in negotiations.
I don’t think all rights issues are the same. We are in unprecedented times with Brent at $20. All I’m really trying to highlight is that with Uganda out of the way there is zero chance that Tullow will not exist post COVID. With hugely prospective licences in Guyana and Suriname with great partners a couple of successful wells can make a huge impact here and I don’t see the nonsense being spouted on here reflecting reality. In an absolute worse case scenario post Uganda sale a RI would without any doubt still allow plenty of upside. All the naysayers on here’s talking about Tullow going bust and posting Standard RNS Disclaimers regarding uncertainty as a groin concern etc are spouting garbage. Who in the current climate has absolute certainty? Airlines, cinemas, restaurant groups. The views on here From many painting the total collapse of tlw are way overblown.
Some may disagree depending on history with this stock but post the Uganda sale if Tullow were to raise £400m by way of Rights issue at say 30p (Open to all shareholders)I think many new holders would be happy to participate. Getting the uncertainty around survival out of the picture for a sustained and committed drilling campaign in Guyana and Suriname licences would bring the unlocked potential back into focus. We would also be back in the FTSE 250 bringing more iis onboard and be able to defer Kenya sale until the outlook and environment allows for fairer value to be attained. Thoughts? Personally if farm downs or Kenya sale does not materialise there is zero chance Tullow will be going bust. A right issue based in the upside across the asset base mean a RI would be easy to get away.
Being conservative if coho and Cascadura provide a consistent daily production of 45MMCF at a conservative $2.8 per MMCF for the company that’s $126k per day or $46m per annum. Market cap here $45m. That’s with zero success at Chinook or Royston. Fill yer boots.
Posted on this board recently. I think everyone needs to take a chill pill with the constant price monitoring and actually make investment decisions on this stock with a 12-24 month view minimum. The only people watching the price minute by minute are the Traders looking to take their gains to the next stock. Let them live on. Guyana will be farmed down and Tullow will still retain a sizeable stake which is meaningful given the size of the prize. Suriname block may also be farmed down but I’d prefer a spin of the wheel on both licences. Apache managed to reach farm in agreement after one successful well which included £100m upfront and $5bn carry on development costs. Now imagine this type of deal for Tullow if goliathberg hits big! So many ways for this stock to get back to a pound. RBL sorted and $575m of the $1bn+ in transit as promised!
Shrewd are you kidding? Current price a gift. Tullow can either have a rights issues or farm down Kenya or Guyana /Suriname licences. One positive we’ll results in Guyana and Suriname and this is back to £1. Have a look at the impact mako well had on Apache a few months back. His is bargain basement. Hedge in place and $575m down with $500m to go.
MrD. I will be very happy if Tullow can offload Kenya for 400-500m USD. I think we need to focus on Suriname and Guyana. A leaner Tullow not held hostage by African states beckons. One hit in Suriname and Guyana and this is back to £1
Thanks for the advice reboundless. If I get out of oil NOW will you be willing to reimburse me for any losses? If not I’d keep the financial advice off this board and also wake up to the reality that you are guessing just as much as the next man. You appear to be another fool with the messiah complex! There is always room for two perspective or indeed multiple interpretations to provide context however at the point you are giving advice all credibility is lost
Hindsight is a great thing and thank goodness for the significant raise or we could have found ourselves paralysed . PB mentioned it had been over scribed but they elected to only seek £9m. I wonder what he would do knowing what we know today? A second well on Cascadura and development of the discovery based on certainty around resource size should be the priority in this climate. You make a great point Simon T.
Bring on the drill! Very pleased to have been able to gather an extra 100k shares sub 25p in recent days. Either of those results would be transformational but if it’s gas up structure from the historical well like at Cascadura I’d expect the majors to be interested in the asset and show their cards pretty sharpish.
To be fair lexicon. I’d prefer gas in current climate too but I wouldn’t turn my back on 341 mbbls in place either. In fact I’d take that right now if you were offering a guarantee. Given the structure is 3-4 times larger than Cascadura if it is gas we could be looking at 0.5 TCF. That’s going to be a very exciting drill.