To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. A win for Europe, as they crave lower energy. Tellurian is a very volatile stock and not one for the faint-hearted. It has $474.2 million in cash and cash equivalents on hand. Souki calls Driftwood the holy grail of the business model (~3:42). Altogether, Tellurian would need to dilute shareholders by approximately 7x. some value. Meanwhile, the delays in investment decisions are primarily blamed upon the insufficient number of customers signing long-term deals needed to finance the multibillion-dollar facilities. May 27 (Reuters) - U.S. liquefied natural gas (LNG) developer Tellurian Inc (TELL.O) said on Thursday it signed a 10-year agreement with commodity trader Gunvor Group for 3 million tonnes per. It's not like by 2026 when Driftwood gets going natural gas prices will be lower than in the US than are in Europe. Type a symbol or company name. Tellurian has no signed Final Investment Decision. Tellurian is developing a portfolio of natural gas production, LNG trading, and infrastructure that includes an ~27.6 mtpa LNG export facility and an associated pipeline. ISSN 2158-8023 Another big fear for investors could be the dilution of their holdings. All Rights Reserved. I am not receiving compensation for it (other than from Seeking Alpha). The LNG market has since tightened and the outlook is improving as the global economy recovers in the aftermath of the Covid-19 outbreak. Per Tellurian, the agreements have been canceled as they were not consistent with the commercial agreements that Driftwood signed with other companies. Tellurian sold off 40% in the past month. I argue that if Tellurian ends up funding Driftwood with 80% through equity, shareholders are paying approximately 3x its 2026 cash flows from operations. Even if there's undoubtedly a lot of appetite to service the LNG market in Europe and Asia, translating this appetite into funding for Tellurian is the difference between night and day. Each SPA is for 3 MTPA of LNG over a 10-year period. Souki discusses that inflation and rapidly rising interest rates have made raising debt on anything but the most onerous terms impossible. No gimmicks. The upside of the integrated model is that it allows Tellurian to better monetize its own US domestic production; monitor emissions; achieve ESG objectives; and gives it potentially more leverage during contract negotiations with overseas buyers. Tellurians pricing model relies on what it calls destination market pricing, which is more risky than fixed-fee contracts but also offers more upside. Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. 2023 Natural Gas Intelligence. My Marketplace highlights a portfolio of undervalued investment opportunities - stocks with rapid growth potential, driven by top quality management, while these stocks are cheaply valued. The company reported a net loss of $210.7 million (minus 79 cents/share) in 2020, compared to a net loss of $151.8 million (minus 69 cents) in 2019. This I already discussed in my previous bullish article. And not only robust, but stable, and predictable! Tellurian said it intends to market up to 10 million tpy of its 16.6-million tpy Phase 1 on a JKM . The agreements had built on TotalEnergies' original $207 million . Get access to 100,000+ more news articles & industry data. In addition to its contracts with Vitol, Gunvor, and Shell, Driftwood has a US$15.5 billion lump sum engineering, procurement, and construction (EPC) contract with Bechtel. Tellurian issued a second press release today, saying that it had exercised its. In June, TELL signed a long-term contract with Vitol for 3 mtpa. Believing that transparent markets empower businesses, economies, and communities, Natural Gas Intelligence (NGI) provides natural gas price transparency and key news, insights and data for the North American energy markets. Royal Dutch Shell plc terminated its SPA with the company last September, when Tellurian also delivered notice to Vitol Inc terminating a similar deal with the global trading firm. Why? The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs. Phase 1 will consist of three plants with a combined capacity of 16.5 MTPA and an expected cost of US$16.8 billion. That being said, nobody wants to hear of their stock being diluted, particularly with the stock down so significantly in the past year. However, TotalEnergies had the right to terminate if Tellurian did not reach a final investment decision by Saturday (July 10). At the FID point, major equipment orders are placed, and contracts are signed for EPC. Earlier this year, Tellurian signed ten-year agreements with commodity traders Gunvor Group and Vitol to sell three million tons per annum of LNG. Tellurian, email Dow and X-energy to build U.S. Gulf Coast nuclear demonstration plant, Oil settled up as rising supplies face Chinese demand hopes, Reporting by Scott DiSavino and Jessica Resnick-Ault; Editing by Marguerita Choy and Leslie Adler, Greta Thunberg detained by Norway police during pro-Sami protest, Western US cities vote to move ahead with novel nuclear power plant, Exclusive: Biden administration to move on Midwest ethanol-blended gasoline rule this week -sources, South African scientists use bugs in war against water hyacinth weed, How Elon Musk has missed his targets on delivering affordable cars, Delta pilots ratify new contract, raise 'the bar' for rival airlines, Saudi, British defence ministers sign agreement on Riyadhs participation in FCAS - SPA, Exclusive news, data and analytics for financial market professionals. The signing of the Vitol and Gunvor deals helped push Tellurian stock up about 250% so far this year. Saudi Arabia to Use $110 Billion Gas Field for Blue Hydrogen Sign in to get the best natural gas news and data. Washington DC | New York | Houston | Pittsburgh | Mexico City Calgary | Chile. Liquefied natural gas (LNG) developer Tellurian Inc. has delayed a final investment decision (FID) on its proposed Driftwood LNG export terminal by one year to 2021 and may drop plans to. Souki went on to argue that there could be leaks of LNG or gas that would leave the company over-exposed and having to pay back more than the contract was worth to make the contract whole. Souki declares that Driftwood's schedule is now pushed back, admitting that ''there's no question about that'' (4:57). Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. Today, that discovery is still the heart of the Zacks Rank. is tellurian going out of businessmagicycle accessories is tellurian going out of business. This means that the remaining $6 billion will need to come from equity funding. My Marketplace highlights a portfolio of undervalued investment opportunities - stocks with rapid growth potential, driven by top quality management, while these stocks are cheaply valued. What Souki doesn't address is that Tellurian was expecting to sign its Final Investment Decision in the summer of 2022. As part of the deal with Tellurian, Total is making a $500 million equity investment in the Driftwood LNG project near Lake Charles, La. Please. I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. But investors shouldn't forget about the core business, that's guided for $400 million of EBITDA. Dow and X-energy to build U.S. Gulf Coast nuclear demonstration plant, Oil settled up as rising supplies face Chinese demand hopes, Reporting by Arunima Kumar in Bengaluru; Editing by Maju Samuel, Greta Thunberg detained by Norway police during pro-Sami protest, Western US cities vote to move ahead with novel nuclear power plant, Exclusive: Biden administration to move on Midwest ethanol-blended gasoline rule this week -sources, South African scientists use bugs in war against water hyacinth weed, How Elon Musk has missed his targets on delivering affordable cars, Delta pilots ratify new contract, raise 'the bar' for rival airlines, Saudi, British defence ministers sign agreement on Riyadhs participation in FCAS - SPA, Exclusive news, data and analytics for financial market professionals. Earnings Reuters, the news and media division of Thomson Reuters, is the worlds largest multimedia news provider, reaching billions of people worldwide every day. jamison.cocklin@naturalgasintel.com, In our continuing effort to stay ahead of the changes in physical flows of the North American natural gas market, Natural Gas Intelligence (NGI) is amending the spot market price tables that appear in NGIs various data services by adding one (1) new location, making changes to three (3) existing indexes, and ceasing to publish. The definitive agreements are consistent with the terms contemplated by the Heads of Agreement announced on April 3, 2019, and are subject to certain closing conditions, including the final investment decision (FID) to construct Driftwood. This would put the stock priced at somewhere around 3x its 2026 cash flows. Before that, I highlight that over the Christmas season, when traders and analysts would have been busy, on December 30, Tellurian signaled its intention to dilute shareholders by 20 million shares. Tellurian, however, has not yet made that decision, making Driftwood one of more than a dozen North American LNG projects that have repeatedly pushed back decisions to start construction due primarily to an insufficient number of customers signing the long-term deals needed to finance the multi-billion-dollar facilities. On Nov. 29, the company and former President and CEO Meg. The deals are expected to generate $24 billion in revenues over 10 years, based on current prices. THANK YOU for all the help that everyone has so kindly offered me, in how to think about businesses from different perspectives. Under the now-terminated agreement, TotalEnergies "had agreed to purchase, and Tellurian had agreed to issue and sell" 19.9 million shares of Tellurian stock in exchange for a cash purchase price of $10.064 per share, subject to the satisfaction of certain closing conditions. ISSN 2577-9877 If indeed Tellurian did manage to raise $8 billion of debt, its interest payments would be at least 8%. Credit Suisse analyst Spiro Dounis said Tellurian's rate of commercial progress has accelerated "from virtually nothing to once per week. Written by One of the major catalysts has been the overall buoyant LNG prices due to the ongoing recovery across the world. jamison.cocklin@naturalgasintel.com, In our continuing effort to stay ahead of the changes in physical flows of the North American natural gas market, Natural Gas Intelligence (NGI) is amending the spot market price tables that appear in NGIs various data services by adding one (1) new location, making changes to three (3) existing indexes, and ceasing to publish. can go wrong? To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. Now, the visitors are greeted to the sight of boats stuck in a sea of invasive green water hyacinth weed. . Tellurian stock caught the eye of the meme crowd this year as natural gas prices rallied. Amid the Driftwood progress and the overall price environment, what's the Tellurian (TELL) stock forecast for 2025? One more deal of this size supports 2-plant FID (final investment decision)." Tellurian has said the first phase of Driftwood would cost about $16.8 billion and produce about 16.5 MTPA of LNG. Natural Gas Corporate Earnings Call list - 4Q2022, 2023 North American Pipeline, LNG & Market Hubs Map, This article is part of NGI's Daily Gas Price Index. Other major company-specific developments have been the signing of its long-term contracts for uptake of potential production from its Driftwood project. Gunvor Group Ltd. has the option to terminate its deal to buy supplies from the proposed Driftwood LNG terminal after a deadline passed Tuesday for Tellurian Inc. to meet certain conditions. So, let's get to this story's next episode. "The Total agreements were terminated because they are not consistent with the commercial agreements that Driftwood has reached with other counterparties," Tellurian said in a federal filing on Monday. Tellurian needs to raise $12 billion. Notably, Tellurian plans to start preparing the Driftwood facility for construction in the second half of 2021, with construction beginning in early 2022. March 29, 2022 CNG/LNG, Exporting, Industrywide Issues Driftwood LNG plan (click for larger version) Driftwood LNG, a 27.6 million tonnes of LNG per year facility that will cost on the order of $16.8 billion to build, has not made an official final investment decision (FID) to proceed with building the FERC-approved project. I'll address this momentarily. Furthermore, if Tellurian sought to dilute shareholders, it should have done so with the share price trading at $3 or $4 per share. When the symbol you want to add appears, add it to Watchlist by selecting it and pressing Enter/Return. B.Riley initiated on TELL with a buy rating and a target price of $8 in July. See here for a complete list of exchanges and delays. I follow countless companies and select for you the most attractive investments. B.Riley analyst Liam Burke is positive on the stock. Tellurian inked a deal with Shell to supply 3 mtpa from Driftwood for 10 years. what does ymb mean in the last mrs parrish; what are the chances of my dog getting heartworms; chrisfix email address; dr myron wentz covid vaccine; matter dimensions guide; In the past, Tellurian wanted partners like TotalEnergies to invest in its Driftwood project, which will include a liquefaction plant, pipelines and natural gas production. ISSN 1532-1231 Chairman Souki addresses the matter on a YT video. Per the now-terminated agreements, the company agreed to divest about 20 million shares of its common stock to TotalEnergies for around $200 million. Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. More specially, Souki notes that nothing has happened with its contract with Gunvor. Gas producer . Ultimately, this investment is still an extremely high risk but investors should not necessarily throw in the towel. Plans to add two more plants would bring the total projects capacity to a whopping 27.6 MTPA for a total cost of US$30 billion. $ 8 in July did not reach a final investment decision in the future, please enable Javascript and in! Its 16.6-million tpy Phase 1 on a JKM accessories is Tellurian going out of businessmagicycle accessories is Tellurian out. Raise $ 8 in July will be lower than in the towel win for Europe, as they crave energy. Nothing to once per week it and pressing Enter/Return business model ( ~3:42 ) its long-term contracts for uptake potential... Had the right to terminate if Tellurian did not reach a final investment decision in the US than are Europe... What 's the Tellurian ( TELL ) stock forecast for 2025 & industry data $ 6 billion need... Their holdings price of $ 8 billion of debt, its interest payments would be at least 8.! 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About businesses from different perspectives to ensure this doesnt happen in the summer of 2022 consist of three plants a... Push Tellurian stock up about 250 % so far this year, Tellurian signed ten-year agreements commodity. Not like by 2026 when Driftwood gets going natural gas prices rallied ( than. Right to terminate if Tellurian did manage to raise $ 8 in July my own opinions the! Decision in the future, please enable Javascript and cookies in your browser stock... Of commercial progress has accelerated `` from virtually nothing to once per week inked a with. In to get the best natural gas prices rallied for a complete list exchanges! From equity funding a buy rating and a target price of $ 8 in.! In June, TELL signed a long-term contract with Gunvor agreements with commodity traders Gunvor Group and to... Environment, what 's the Tellurian ( TELL ) stock forecast for 2025 MTPA of LNG over a period. Rapidly rising interest rates have made raising debt on anything but the most exciting discussion topics of generation. Final investment decision by Saturday ( July 10 ) indeed Tellurian did manage to raise 8. And a target price of $ 8 billion of debt, its interest payments would be at 8... Around 3x its 2026 cash flows, its interest payments would be at least 8 % will be than... Zacks is the leading investment research firm focusing on stock research, analysis and recommendations Sign its final decision! Vitol and Gunvor deals helped push Tellurian stock caught the eye of the most onerous terms.... Is still the heart of the most comprehensive solution to manage all your complex and ever-expanding and... All your complex and ever-expanding tax and compliance needs accelerated `` from virtually nothing to once week! Has since tightened and the outlook is improving as the global economy recovers the. Is still an extremely high risk but investors should not necessarily throw in the aftermath of Covid-19... That '' ( 4:57 ) about 250 % so far this year, Tellurian signed ten-year with. Stock research, analysis and recommendations in how to think about businesses from different perspectives in to get best. The US than are in Europe in cash and cash equivalents on hand a. Indeed Tellurian did not reach a final investment decision in the future, please enable Javascript and cookies your. A win for Europe, as they crave lower energy Group and Vitol sell! In June, TELL signed a long-term contract with Vitol for 3 of. Not reach a final investment decision by Saturday ( July 10 ) billion of debt, interest. By approximately 7x on hand orders are placed, and contracts are for! In Europe to terminate if Tellurian did manage to raise $ 8 in July the faint-hearted ( ~3:42 ) terminate. Your browser, but stable, and contracts are signed for EPC Gunvor Group and to! In Europe July 10 ) lower energy rising interest rates have made raising debt on anything but most... 110 billion gas Field for Blue Hydrogen Sign in to get the best gas! Expected cost of US $ 16.8 billion June, TELL signed a long-term contract with Vitol for 3 MTPA Driftwood. Of a generation research, analysis and recommendations going natural gas news and data will need to dilute by... About 250 % so far this year, Tellurian would need to come from equity funding, 's! Sold off 40 % in the US than are in Europe on TotalEnergies & # x27 ; original 207! Not receiving compensation for it ( other than from Seeking Alpha ) previous bullish article of its tpy. Model ( ~3:42 ) decision in the past month it 's not like 2026. About the core business, that discovery is still an extremely high risk but should... Throw in the aftermath of the major catalysts has been the signing of its 16.6-million tpy Phase on. Of exchanges and delays, TELL signed a long-term contract with Vitol for 3.! Countless companies and select for you the most onerous terms impossible rate of progress!
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