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Msg  12105 of 12255  at  2/25/2020 8:13:55 AM  by


 In response to msg 11972 by  Public_Heel
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Re: Tullow trying and floundering.

I see this NR indicates Tullow has $2.8bil in debt vs ~60-70kbpd production - recent dry hole off Peru - Marina well - someone else was the operator.
This news about Total not being interested in buying Tullow
EV of Tullow ~$3.6bil (US$) with plenty of assets, but need to poke a straw or two in Guyana to the more desirable targets. That they poked a 2nd hole into probably, heavy oil says something - instead of trying to probe a deeper target. I assume they were trying to "play it safe" with low hanging fruit. When drilling in water - go smart or go home - imho. I'm sure they new the API of #1 before drilling #2. Looks like a shakeup was needed at Tullow.

Total Chief dismisses Tullow Oil takeover idea

9:47 AM ET, 02/11/2020 - Reuters

By Ron Bousso and Bate Felix

ABERDEEN, Scotland, Feb 11 (Reuters) - Total Chief Patrick Pouyanne dismissed the idea it might buy its partner in East Africa and Guyana, Tullow Oil, whose share price slumped to 19-year lows in December over a string of bad news, stoking takeover speculation.

Total is a partner in all growth markets for Tullow Oil whose market capitalisation shrank to around 633 million pounds as of Wednesday from 3.28 billion pounds in September. It is slashing its workforce and restructuring its portfolio. Amid industry speculation about a potential Tullow takeover target, Pouyanne told Reuters when asked whether Total might buy Tullow: "Stop dreaming... No".

As of late 2019, Tullow was saddled with $2.8 billion in debt, a hangover from the last oil price crash which saw Brent crude futures plummet to below $30 a barrel in 2016.

High debts can make buying assets a more attractive option than a corporate sale.

Offshore Guyana, Tullow owns 60% and Total 25% of the Orinduik block, estimated to hold around 5.1 billion barrels of oil equivalent. Total also holds 25% in the Kanuku block, adjacent to Orinduik, in which Tullow holds 37.5%.

While two of Tullow's previous wells in Orinduik produced heavy oil, calling into question the quality of the reservoir, other wells targeting deeper layers have produced lighter oil - reviving hopes for the commerciability of wells targeting the so-called Upper Cretaceous.

Pouyanne said he expected two or three wells to be drilled offshore Guyana this year. Total, Tullow and their Orinduik partner Eco are due to meet this month and discuss next steps for their drilling off Guyana.

In Uganda and Kenya, Total and Tullow have partnered to bring the countries' first oil projects onstream, but both projects have hit snags.

Onshore Uganda, a deal for Tullow to sell a chunk of its stake to Total, fell through in August due to tax disputes with the government.

Uganda's government said in December it had settled the dispute with the companies, but they have not yet confirmed any such deal.

Pouyanne told Reuters discussions were still ongoing, but that Tullow's "financial issues" must also be dealt with.

In Kenya, Tullow and Total aim to reduce their stakes with a joint sale that could see Tullow exit completely amid uncertainty over the project's launch, banking and industry sources said.

Tullow declined to comment.

(Writing by Shadia Nasralla)


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