Well its good to get that drop out of the way before the bank holiday. Should creep up again.....Tullow have lost 5 offshore licences in Peru through no fault of there own...I would mark this as a +++.......$80 a barrel puts gasoline at $3.00 a gallon in the USA. Its there watershed. That according to Malcy's blog works out at 40p a litre.
Are you surprised Sage, where have you been. This has been planed for nearly two years. Remember the insurance is stumping up too. It is routine for all wells to shutdown now and then......Lovely tree shake going on..Sage do you work for Goldman Sh+++++, always behind the curve and having your own agenda.
According to this report, agreement has been reached in Kenya on the internal distribution of tax revenues from oil, removing an impediment to exporting from the Tullow discoveries. Looks like good news .
"President Uhuru Kenyatta said on May 19 leaders from the northern Turkana county agreed for the central government to receive 75 percent of the oil income, while 20 percent will be earmarked for regional governments and 5 percent for the local communities. While lawmakers from the region originally wanted a 70:20:10 ratio, they dropped their demands after the government agreed not to peg normal county budget funding to the oil revenue."
Its looks like the planed shutdown will start next Monday. I hope Tullow has give themselves some riggle room.......If it was me I would plan for four weeks and if it was complete in three weeks . the market would react positively. https://www.theoilandgasyear.com/news/jubilee-fpso-to-pause-for-repairs/
The uncrossing trade this evening was £2.76, so still looking very strong. interesting divergence in the three remaining shorts. The total is up to 2.99% from 2.97%. Capital Fund Management reduced from 0.78% to 0.67% on 16/05/2018 (once again a late declaration) while Linden increased again from 0.80% to 0.93% yesterday.
Or maybe he saw sense, went long and is now posting under a different alias, but still bitterly and fruitlessly trying to goad other posters with inane and pointless incorrect assumptions. Sad but funny.
His last post was in May 2017 by which time he probably saw the writing for TLW's recovery. At least he had the sense to beat Odey & Co. to the door though.
Yea he was one of many that help do a good hatchet job on Tullow and drove it down past it true value.He did get the help of OPEC when they crashed the price of oil from $100+ down to $30........In a way I should be very grateful for mr x, not only does he correct my grammar but I was able to buy at a very low price.....If mr x is in the Caribbean he could check out the Jamaica prospect. Have a good weekend and get out the barbecue.
When I mean to say by unload there shorts on the dips is, to buy them back....As mister x would point out, my grammar is no good.....Rig count will be interesting today, 80 dollars a barrel is the new line in the sand for a while.
Yes, but they shorted on Tuesday and then the share price went up by over 6% on Wednesday. My guess is that they were sending good money after bad in an attempt to restrain the price. If they were really clever they would have waited before more short selling. Risky indeed when the oil price is so strong. They may get lucky but, as you say, it's not their own money.
I would expect the shorts to go up, when the share price goes up. They will try and unload when there is a dip, which normally happens. It's a risky strategy but its not there own money . If it works they get a bonus, if it fails they can get there standard charges.
The short positions are still under 3% at 2.90%, Linden actually increased their position from 0.72% to 0.80% yesterday. The other two declared positions sitting it out are Capital Fund Management SA at 0.78% and Key Group Holdings (Cayman) Ltd at 1.39%
3-D seismic survey of the coast has just finished, very early to call if there is any commercial oil......I would put the share price rising ,down to catch up on the crude oil price.......... But you always hope
Interesting question about EVs Harry, I was just thinking about it when at Dublin airport recently.
They have 26m passenger trips a year which seems insane for a small country, and watching those beautiful machines flying overhead, one every couple of minutes, it just struck me that the IC engine is very unlikely to be rendered extinct anytime soon. That was just my gut feeling.
No EVs for hire at the car hire firms either as far as I could see.
It is a sound proposition that the IC engine will be replaced one day, but as some guru once said you will often get into more trouble investing on the basis of a sound proposition that an unsound one. (As happened with: Everyone needs a house therefore property is always a good investment )
Maybe when world consumption figures start declining I will change my mind but they seem to be rising by about 1m bopd every year. Plus much of the oil comes out of the worlds trouble spots and supply can be erratic.
What I think is a pity is to see the state of some countries that have huge oil resources, Venezuela, Nigeria, Iraq etc., etc.
It is quiet because all of the news has been so obviously good that it doesn't need to be repeated. There are still 3 declared shorts still making their escape and likely many more below the 0.50% declaration threshold still trying to get out. Both short buyers escaping and long buyers coming in have a shared interest in a low a shareprice..
TLW's excellent known and reported position aside the oil price is benefiting the management's dedication to reducing debt with every day. The hedges against a floor price were good security and may still have benefit. The cost is dwarfed by the benefits of the current oil price, now heading for $80. The real shareholder gains will come with the next results. when TLW reports the reduction in its debt. In the meantime those who have done their research will want to keep the secret to themselves. Shhhh.
I was thinking the same. Tullow did a good job hedging on the way down. they should be more positive and hedge less on the way up.............Gubu what is your take on EV CARS.?All I see is people buying larger conventional cars on cheap credit.
Tullow is still on the naughty step with some of the market, that will not last. Remember Tullows assets are also climbing when oil goes up, not just the revenue it gets from production. Oil is climbing because the glut is over, not so much the Middle East. Anybody noticed any uptake on E.V. or any charging points being installed, beside the token few. Volvo have 18 months for all there models to be hybrid or E.V.
BG, imho TLW's chart is currently Brent's chart on uppers. It has been Brent's chart on downers for a while but the mood is changing and that "leverage" will support on the way up. The looming supply side effect of lower exploration investment has been known about all along but has been swamped by the emphasis on negative news. That effect will emerge as a fact as demand continues to grow. Whether it results in $300 oil is another matter but it must result in higher oil prices.
US oil is light oil, to the extent that is usually highly flammable when it comes out of the ground and dangerous to transport by road or rail. Production is now hitting the barrier of infrastructure problems in the absence of pipelines. Light oil doesn't provide all of the refinery products that heavier crudes do so isn't a direct competitor for them across the board. All oil isn't equal but the knee jerk reaction to the low oil price has treated them as such. It is worth noting that one major customer for US light oil has been Venezuela where it has been used to dilute their very heavy crude before it can be refined. I see that Venezuela is now reduced to offering big discounts for payment in bitcoins.
Add all that up and take account of still rising demand, reduced exploration and the fact that the output from fracking peaks quickly and then declines rapidly and we have what looks like a perfect environment for a rising oil price (pipelines need some time to provide a return on capital). There's many a slip twixt cup and lip of course, but imho this is a case where patience will pay off.
So, 2.34 hit at close....this needs to hold. If my new, if somewhat novice charting skills work out, then £3.60 is on the way...fingers crossed!
I note that the US imported record amounts of crude resulting in the big in inventories. The US needs huge investment in infastructure ie, lots of pipes to move oil from the fracking/well sites. This will not happen very quickly. With all the other geopolitical issues, and the on-going output cuts, the poo is, imho, only going north.
BG, on the recovery, I think that what we are seeing in TLW at the moment is the tail end of the institutional short sellers as they escape and that is restraining the price. You could see how it was walked down on low early volume from the outset yesterday before recovering and the same seems to be happening today. We have just three declared shorts remaining and doubtless many more below the 0.50% waterline still making their way out. The diminishing list is testament to TLW's improving prospects.
The chart is strikingly similar to other oil healthy stocks, look at RDS for example since the beginning of the year or even Weir Group. They all mirror Brent over the same period. Brent was close to $75.40 earlier this morning and looks strong from both the supply and demand sides and the geopolitical issues are adding to that.
As things are the recovery from the February 2018 low alone should see us to around £2.96. Longer term the recovery from the January 2016 lows of about £1 (corrected for the rights issue) promises gains that I won't even mention at this point. TLW's "leveraged play" worked against the company on the way down. Its improving fortunes will see the leverage leveraged even more on the way up imho but certainly support your £3.60.
All subject to the oil price but with the increased efficiencies in the industry during the hard times oil doesn't need to get to $100 to fuel a spectacular recovery (but it could certainly get there).
A few thoughts on that matter of that "other role" for the Company Secretary. This is just conjecture on my part but it makes sense to me.
TLW is obviously keen on restoring its credit rating. One criticism from the credit rating agencies has been about the level of dependence on Ghana so TLW will need to diversify in order to keep them happy. We have seen signs of that in places like Jamaica etc. on the other side of the Atlantic. TLW has long been a believer in the theory that the oil bearing geology of the West African coast is mirrored on the East coast of South America and that seems to be coming to fruit. The two land masses were one in the distant past and you can still see how closely the coastlines conform. Anyway, things are steadily getting busier over that side for TLW and the management will need to be beefed up to allow for the growth. TLW is pretty close to Africa Oil and that seems to have good management, particularly in Keith Hill. Some sort of merger could be on the cards. Africa Oil's market cap is currently around £316m and the business could grow much more quickly with better access to capital. It seems well within TLW's reach, particularly if a deal were all or partly paper, and the working relationships are already established. The new team would hit the ground running to manage the business in Africa. There would be synergistic benefits for both and it would allow TLW to upgrade its management structure pretty much overnight.
As I said, just conjecture but it would be a good move for both companies I think.
Not sure why Les Wood would have spoken publicly about the issue unless dividends were on the cards. I'm sure that he would have cleared any such statement before making it publicly, but it would be wrong of the company to raise expectations (and therefore possibly influence the share price) before it was firm policy. A hint is probably enough right now. Share buy-backs seldom have the equivalent effect on the share price but reduce the number of shares on which dividends are being paid so share buybacks and dividends in combination make some financial sense. TLW must eventually choose between the balance of capital appreciation and dividend returns to keep its shareholders happy. Note, from the 1H 2015 report:
"In 2015, in view of the fall in the oil price during 2H 2014, the Board suspended the dividend. At a time when Tullow is focusing on capital allocation, financial flexibility and cost reductions, the Board believes that Tullow and its shareholders are better served by investing these funds into the business."
Dividends were suspended with reference to specific financial constraints, not "ditched" as many reported. I'd expect an official statement if the suspension policy were to become a permanent policy. Standard and Poor have stated that a return to dividends is unlikely for 2 years:
The company will be more concerned with continuing to recover its previously high credit rating before paying a dividend.
On another point, this AGM statement leaves room for conspiracy theorists:
"From the conclusion of the AGM, Kevin Massie will be stepping down as Company Secretary to pursue another role in Tullow. The Board has appointed Adam Holland, currently Deputy Company Secretary & Senior Legal Advisor, to the role of Company Secretary."
Now, what "other role" might require the undivided attention of a company secretary in an oil company? I can only think of a couple of possibilities.
Having attended the AGM, the chances of a dividend are very unlikely. Share buy backs might well occur in the distant future, however, we still have a lot of debt to sort out, if memory serves correct, then, debt is around £3.4 billion.
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