Member Info for xxnjr

Sorry I have to disagree there. OK it may well have been cheaper to hedge at $59 but I fail to see the logic behind it. For if the OP were ever to reach that level free cash flow would probably be closer to zero whereas if they had hedged at $70 FCF may only have been halved from guidance. I fail to see the point of hedging at a level where FCF is zero, or even negative!

Flavius, yes agreed 2P + 2C. However some of the 2C would probably be risk weighted? My concern with TLW is the rig was on contract for 1,165 days from 06/04/2021 until 14/06/2024 with 23 wells drilled. How much reserves were added? None. In fact revisions over the period were negative 30m barrels!

OTOH Kosmos say Jubilee has gross 2.4 billion barrels of oil originally in place with a current assumed recovery factor of 33% in their reserves modelling. However they "feel" ultimate recovery may well end up in the high 30's. So maybe another 6%, or gross 144 mmbbls of upside on top of their current reserves assumptions.

Let's hope Kosmos are right. Also that the new 4D results in new wells adding to reserves.

Yes that was gross debt. Won't net debt be similar to the $1.45bn now? They paid off about $500 bonds + interest with Cash + Glencore. The cash spend will reduce remaining cash. And the gross debt will increase by $270m on the Glencore.

Whilst the trading update said "Independently audited 2P reserves at year end 2024 of 164.5 mmboe (212 mmboe at year end 2023), valued at c.$2.5 billion (NPV10)." I'd be surprised if anyone thought the company was worth $2bn taking into account the debt in the current environment.

(sorry - that was meant for JBond) Or anyone else who held them!

Congrats on your bond transaction by the way. Well done for holding (the bond!).

Mcap £230m Gross Debt $1.8Bn

Who is going to pay over $2bn for a company producing only 48K bopd?

True Tman but I bet they are getting nervous in Chiswick!

Another right Rahul mess.

Recent trading update "Hedge portfolio protects c.60% of forecast sales volumes at weighted average price of $59/bbl through the year....."

Amazing how TLW never seem to have competitive hedges in place when OP falls. ISTR Kosmos for example are hedged at $70.

Would have been useful to know Net Cash.

The audit section of the last annual report says:-

"The VIU recoverable value is risk- adjusted for uncertainties associated • with the Group’s ability to recover

the value of the asset. These uncertainties include the ability to secure a strategic partner through a • farm down, obtaining government deliverables (for example access to land and water and improved fiscal terms), and arranging financing to develop the asset, which represent a source of potential management bias."

Aside from the interesting comments about Management Bias, the other takeaway from that is gov.KE will have to improve their fiscal terms otherwise the project would appear to be uneconomic. This is feel is one reason the project has been stalled for years.

Judging by yesterdays market prices of both bonds, the market believes the 25's will be fully repaid at maturity. According to the offer document "The Notes will mature on March 1, 2025."

Random thought. It's in Kenya's interest to throw Tullow off the project. Then they avoid loosing cost recovery oil on the gross USD 2bn spent so far.

There are 3 water injection pumps on the fpso which ISTR have a capacity of up to 150Kbwpd each. (Total combined capacity 450 Kbwpd). But in practice low three hundreds seems to be the current maximum output. About 5% of produced associated gas (or 12 mmscfd) is used to power the 2 Gas Turbines (could be 3 GT's?). You can see the amount of fuel consumed in Petrocom production data.

Persistent w/inj issues have been occurring for 2, or 3 yrs. I don't really trust TLW's narrative. Firstly they have failed to explain in detail what exactly the issues are and secondly they keep telling us its fixed. Except that it is not!

When thinking about voidage replacement, surely the important fact is not necessarily how much water was injected but how much water arrives in the right location to provide pressure support. So if for example there's a bad communication pathway between the w/inj well and the producing well then it doesn't really matter how much water you inject as it may not arrive in the right place in sufficient volumes to mitigate production decline.

I'm tending the think there are two issues. The reliability or otherwise of the topsides to inject the desired amount. And that in places correlation between the reservoir model and drill reality is not what it should be with some of the w/inj wells. If that is the case the new 4D seismic should help with more accurate well placement.

FWIW the land being potentially acquired will be leased back to whatever consortium developes the project.

89K or 150K probably demonstrates how out of date that web page is?

As a reminder bit of background on recent developments

https://oilprice.com/Latest-Energy-News/World-News/Kenyan-Government-Rejects-Tullow-Oils-Field-Plan.html

Tullow's CAPEX budget for 2025 has only allotted $25m to cover TEN, Portfolio Exploration and Kenya.

No breakdown in there. But doesn't seem like much will be spent on Kenya.

PS...... on reflection I believe the incentive plan shares were awarded as Nil cost. But since the SP has gone down since the various share awards the value of the share component of the bonus has gone down.

for example, for arguments sake

£1m bonus, 50% in shares = £0.5m

SP at time of award 50p

Shares awarded: 1m

Value now: £165K, not £500K

Theoretically Rahul has about 24m shares but the majority are options with exercise prices above current market price.

He has also bought a limited number, for cash.

11/5/2020 1.346m share at 26p Loss £108K

20/6/2023 0.361m shares at 28.56p Loss £38K

He has 3m nil cost options on appointment.

Also 3m options on app't at 0.2566p

Also 3m options on app't at 0.5132p

The rest are TLW incentive plan options with notional exercise price of between 26p and 55p with were in lieu of cash bonus, as 50% of bonus is awarded in shares.

Share options isn't my thing but most of them are underwater. So if that remains the case on exercise dates (or whatever you call those) then the underwater options have no value?

7.17p was the intraday low on 18/3/2020 with a closing low of 7.55p the same day.

Not sure if the current SP is related to shorts, or not (who knows). Would have thought it was just down to uncertainty to do with (I) Production volumes (II) Reserves upgrades, or downgrades!!! once new 4D seismic is processed and analysed and (III) Clarity over refinancing of '26 bonds etc.

I would imagine Tullow have been sounding out investors on the '26 bond refinancing, so I'm wondering if the need to sell assets is due to feedback from those discussions (assuming discussions have taken place)?