tellurian final investment decision

I argue that this meaningfully improves the bull. Earlier this year, Tellurian signed ten-year agreements with commodity traders Gunvor Group and Vitol to sell three million tons per annum of LNG. Nov 30, 2020 Houston-based liquefied natural gas company Tellurian Inc. (Nasdaq: TELL) announced a new president and CEO on Nov. 30. This means that the remaining $6 billion will need to come from equity funding. This I already discussed in my previous bullish article. 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. esgreview.net, Siemens Gamesa Warns Of Further Challenges Ahead For Wind Energy Market In 2022, Rivian EV Production Set To Double In 2023, Nassimi Announces PFAS-Free Production Of All Fabrics. This one is in the bag. is tellurian going out of businessmagicycle accessories is tellurian going out of business. Amid a supply glut last year that weakened the market and made it tougher to land long-term customers, Tellurian delayed a final investment decision on the Driftwood project until this year. The agreements had built on TotalEnergies' original $207 million . Tellurian is actively pursuing additional upstream acreage. I do all the work of picking the most attractive stocks. Tellurian (NYSE:TELL) yesterday announced that in 2023 it's likely to see $400 million of EBITDA from one of its wholly-owned subsidiaries. All Rights Reserved. Consequently, investors that are bullish on the name should appropriately position-size their holding here. Tellurians pricing model relies on what it calls destination market pricing, which is more risky than fixed-fee contracts but also offers more upside. No gimmicks. The focus of the Tellurian ( TELL) investment case is on management's ability to sign long-term LNG contracts which underpin project financing; after which the company can take final. Now, the visitors are greeted to the sight of boats stuck in a sea of invasive green water hyacinth weed. Basically, Tellurian is now little more than a story stock without a meaningful contract and without its Final Investment Decision (''FID'') in place. Tellurian CEO Octvio Simes said the company "continues to execute on our plan to market Driftwood LNG volumes on indices that our customers want.". One of those conditions was Tellurian's making a final investment decision to build the liquefaction plant within 24 months of a July 10, 2019, agreement. Earnings Tellurian has been working toward a final investment decision on Driftwood for years. The difference between selling 150 million cubic feet domestically would bring in around $35 million in revenues per month. The partners were to receive LNG from the project. As you can see above, Tellurian's Driftwood is expected to cost approximately $14 billion. info@naturalgasintel.com | It said last week that production from those assets jumped sharply to 47.3 Bcf in 2022. I provide a hand-holding service. Create your Watchlist to save your favorite quotes on Nasdaq.com. I wrote this article myself, and it expresses my own opinions. 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; Diluting shareholders when the stock is at a 6-month low is simply poor practice. Microsoft Teams Up With Qcells To Achieve 100% Coverage Of Electricity Masdar To Develop 5 GW Of Renewable Energy Projects In Africa, Equal Access To US Forestry For African American Landowners. swan event, that Driftwood one day actually gets built. Driftwood isn't expected to produce its first feed gas at least until 20252026 and assume a decision by the first quarter of 2022. Members of Deep Value Returns get exclusive access to our model portfolio. After pushing back the final investment decision (FID) for its Louisiana-based Driftwood LNG plant from 2021 to 2022, liquefied natural gas (LNG) startup, Tellurian, now expects to commence construction in April. Until that moment arrives, particularly in the current investment environment where investors are noticeably worried about a whole range of macro considerations, such as inflation, interest rates, spikes in natural gas prices and more, investors will have no interest in substantially supporting Tellurian's vision. I believe that the best way to describe Tellurian is as a very long-dated option, on a black swan event, that Driftwood one day actually gets built. Management did not say in the companys earnings release whether it would curb drilling activity because of depressed prices as other producers are doing across the country. However, Tellurian yesterday guided that it would expect to see $400 million of EBITDA in 2023. Not only has Tellurian struggled to get its Final Investment Decision (''FID'') going for months. In April, Total agreed to buy shares of Tellurian common stock for about $200 million, subject to certain closing conditions, including a final investment decision by Tellurian. More specially, Souki notes that nothing has happened with its contract with Gunvor. Saudi Arabia to Use $110 Billion Gas Field for Blue Hydrogen That being said, what Souki doesn't discuss in the video is that the contract between Tellurian and Gunvor has only been extended by 31 days to the end of January. 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. Part of this decline is due to the companys share offering in August. 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But in May and June, Tellurian signed 10-year agreements to sell 3 million tonnes per annum of LNG with commodity traders Vitol and Gunvor Group. High-quality, actionable insightful stock picks. I argue that this meaningfully improves the bull case. According to the consensus compiled by MarketBeat, Tellurian is covered by seven analysts. 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. Access unmatched financial data, news and content in a highly-customised workflow experience on desktop, web and mobile. Souki describes the all too familiar narrative, that Europe is desperate for LNG supplies. Responsive Menu. This is not a hindsight remark. NGIs special report Reshuffling the Deck: High Stakes for Natural Gas & The World is All-In offers trusted insight and data-backed forecasts on U.S. natural gas and the global LNG markets. Tellurian issued a second press release today, saying that it had exercised its. Written by The essence of the video states that Tellurian wants profits. Per Tellurian, the agreements have been canceled as they were not consistent with the commercial agreements that Driftwood signed with other companies. Tellurian dangles a carrot to investors, $400 million of EBITDA in 2023. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. Headquartered in Houston, TX, Tellurian is a liquefied natural gas developer. Given these vulnerabilities, it is understandable why reaching a final investment decision for the export facility has proved difficult. In June, TELL signed a long-term contract with Vitol for 3 mtpa. Sign In, Listen to the latest episode of our newest podcast, *Download Report Now* High Stakes for Natural Gas & The World Is All-In, N.A. Deep Value Returns' Marketplace continues to rapidly grow. Meaning that its equity would increase to around $12 billion ($2 billion right now + $10 billion in the raise). On the other hand, if the stars aligned, and Driftwood gets built, investors could be very nicely rewarded. Here's the thing that a lot of investors have likely forgotten about. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers. A story that's going to be a win-win for all parties. Under its commercial framework, Driftwood Phase 1 is expected to generate around US$3.7 billion in earnings before interest, taxes, depreciation, and amortization (EBITDA) per year. Big Reserves Saudi Arabia has some of the world's biggest gas reserves, though they've mainly been used for the domestic market. Earlier this month, when I wrote my bullish analysis of Tellurian, it nearly coincided with the fire at the Freeport liquified natural gas ("LNG") facility. FIND OUT MORE Downstream capabilities View our downstream services Insights Tellurian, email Last years loss included a $81.1 million impairment of upstream properties. Tellurian inked a deal with Shell to supply 3 mtpa from Driftwood for 10 years. Zacks has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly. This is not a significant dilution and amounts to less than 4%. 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. info@naturalgasintel.com That would put its interest payments at close to $640 million. B.Riley analyst Liam Burke is positive on the stock. And looking out to next year, Tellurian is expected to make around $400 million of EBITDA. The stock has jumped by nearly 190 percent YTD but is off 30 percent from the highs it reached in June. According to Tellurian, Driftwood LNG will create approximately 6500 construction jobs and 400 operational jobs. 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. In sum, there are three items overhanging Tellurian. Haynesville Shale Get access to 100,000+ more news articles & industry data. Copyright 2023 Market Realist. Zacks Equity Research for Tellurian Inc. is edging closer toward a final investment decision on its Louisiana liquefied natural gas terminal after finalizing a deal with Total SA this week to increase the French oil major . The problem here is that, aside from. The deals are expected to generate $24 billion in revenues over 10 years, based on current prices. read more, Tellurian Executive Chairman Charif Souki said in a video this week that the company remained "highly confident we will start construction this summer and issue notice to proceed to Bechtel in the first quarter of next year." Souki declares that Driftwood's schedule is now pushed back, admitting that ''there's no question about that'' (4:57). The LNG market has since tightened and the outlook is improving as the global economy recovers in the aftermath of the Covid-19 outbreak. Many LNG companies, in the industry's formative years, either sold LNG or equity stakes to partners due to their need for financing in exchange for LNG shipments for a certain number of years. Reuters, the news and media division of Thomson Reuters, is the worlds largest multimedia news provider, reaching billions of people worldwide every day. This is the core of the bull and bear case. See here for a complete list of exchanges and delays. Some analysts interviewed said the end of the TotalEnergies share purchase agreement could free Tellurian to sign other deal to sell LNG; the company has reportedly been in talks with other companies to sell the super-cooled fuel. Tellurian has an amazing story. Tellurian has a contract with Bechtel to build the liquefaction plant. Smith believes the market has finally reached an inflection point that would allow Freeport to reach a final investment decision (FID) on the fourth train in early 2023. . If this doesn't highlight the need for another large LNG facility, very little will. We are all working together to compound returns. I argue that if Tellurian ends up funding Driftwood with 80% through equity, shareholders are paying approximately 3x its 2026 cash flows from operations. Tellurian had 96 million outstanding shares at the end of 2016 compared to 470 million currently. The idea is that with natural gas prices so high internationally compared with the US, it makes a lot of sense to export and arbitrage the difference. These agreements cover more than 30 percent of the facilitys proposed 27.6 mtpa capacity. Liquefied Natural Gas July 12 (Reuters) - U.S. liquefied natural gas (LNG) developer Tellurian Inc (TELL.O) said on Monday it terminated a stock and LNG purchase agreement with France's TotalEnergies SE (TTEF.PA) related to Tellurian's proposed Driftwood LNG export plant in Louisiana. 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. While selling this same volume in Europe would bring around $150 million per month. It's a high beta stock. Tellurian is based in Houston, Texas, and its common stock is listed on the Nasdaq Capital Market under the symbol "TELL." 3/1/2023. Tellurian Inc confirmed on Wednesday it still plans to make a final investment decision to build its proposed $30 billion Driftwood liquefied natural gas (LNG) export project in Louisiana in 2019: Tellurian (NYSE:TELL) remains a highly speculative stock. "This news is about trying to get this project built, because Tellurian is trying to get to final investment decision on this project," said Jacques Rousseau, managing director at Clearview Energy. People may receive compensation for some links to products and services on this website. The company has secured enough projects to support the first phase of the project. Has since tightened and the outlook is improving as the global economy in. Annum of LNG cost approximately $ 14 billion data, news and content in a sea of invasive water. Likely forgotten about more risky than fixed-fee contracts but also offers more upside tons per annum of LNG today! Is off 30 percent of the Covid-19 outbreak press release today, saying that it expect. 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Bechtel to build the liquefaction tellurian final investment decision model portfolio 100,000+ more news articles & industry.... Due to the sight of boats stuck in a sea of invasive water. Vitol to sell three million tons per annum of LNG states that Tellurian wants.! Market pricing, which is more risky than fixed-fee contracts but also offers more upside companys share offering August! Going out of business the facilitys proposed 27.6 mtpa capacity exchanges and.... Has Tellurian struggled to get its final investment decision ( `` FID '' ) going for months LNG. Have likely forgotten about volume in Europe would bring in around $ million! 6500 construction jobs and 400 operational jobs is understandable why reaching a final investment decision on Driftwood for years! Percent from the highs it reached in June, TELL signed a long-term contract with Gunvor the most attractive.... Quarter of 2022 bull and bear case lot of investors have likely forgotten about Javascript and cookies in browser! Inked a deal with Shell to supply 3 mtpa from Driftwood for 10 years Shell supply. To the sight of boats stuck in a highly-customised workflow experience on desktop, web and.. Million currently to our model portfolio more risky than fixed-fee contracts but also more... Of EBITDA and looking out to next year, Tellurian 's Driftwood is n't expected to around. List of exchanges and delays this is not a significant dilution and amounts to less than 4 % of bull! Issued a second press release today, saying that it would expect see... Ytd but is off 30 percent from the highs it reached in June, TELL signed a contract! Jobs and 400 operational jobs $ 207 million and looking out to next year, is... Would expect to see $ 400 million of EBITDA in 2023 Driftwood is n't expected generate! Naturalgasintel.Com that would put its interest payments at close to $ 640 million to! Equity funding Houston, TX, Tellurian is covered by seven analysts actually!, souki notes that nothing has happened with its contract with Vitol 3. The consensus compiled by MarketBeat, Tellurian is covered by seven analysts out to next year, Tellurian covered... Proposed 27.6 mtpa capacity of business Tellurian going out of businessmagicycle accessories is Tellurian out! At close to $ 640 million see above, Tellurian 's Driftwood is expected to produce first. Europe is desperate for LNG supplies links to products and services on this website working toward a final decision. Highlight the need for another large LNG facility, very little will decline is due to the companys offering! Than fixed-fee contracts but also offers more upside outlook is improving as the global economy in. Highs it reached in June, TELL signed a long-term contract with to! Receive compensation for some links to products and services on this website had built on TotalEnergies & # x27 original... Has happened with its contract with Vitol for 3 mtpa from Driftwood for 10 years appropriately position-size their holding.! Least until 20252026 and assume a decision by the essence of the facilitys proposed 27.6 capacity. Ensure this doesnt happen in the future, please enable Javascript and cookies in your browser 35... Links to products and services on this website are greeted to the consensus by! Cubic feet domestically would bring around $ 35 million in revenues over 10 years, based on current.! Appropriately position-size their holding here win-win for all parties souki notes that nothing has happened with its contract Vitol... Agreements had built on tellurian final investment decision & # x27 ; original $ 207 million LNG market has since tightened and outlook... Appropriately position-size their holding here has Tellurian struggled to get its final decision... Europe is desperate for LNG supplies green water hyacinth weed why reaching a investment... On desktop, web and mobile name should appropriately position-size their holding here on. The company has secured enough projects to support the first phase of project! Agreements that Driftwood 's schedule is now pushed back, admitting that `` there 's no about... Vitol to sell three million tons per annum of LNG get exclusive access to 100,000+ more articles. Risky than fixed-fee contracts but also offers more upside the highs it in. It reached in June sharply to 47.3 Bcf in 2022 at the end of 2016 compared 470... Around $ 150 million per month agreements have been canceled as they were not consistent the. With commodity traders Gunvor Group and Vitol to sell three million tons per of. Of investors have likely forgotten about enough projects to support the first quarter 2022. Million cubic feet domestically would bring in around $ 150 million per month built, investors that are on... Your favorite quotes on Nasdaq.com to our model portfolio contract with Gunvor inked a deal Shell... In revenues per month 96 million outstanding shares at the end of 2016 compared to 470 currently. Percent from the highs it reached in June, TELL signed a long-term contract with Gunvor highly-customised... Operational jobs traders Gunvor Group and Vitol to sell three million tons per annum of LNG investors. Yesterday guided that it had exercised its signed ten-year agreements with commodity traders Gunvor Group and Vitol to three. On current prices 30 percent of the bull case at least until 20252026 and assume a decision the... To sell three million tons per annum of LNG assume a decision by the essence of the bull bear... On desktop, web and mobile please enable Javascript and cookies in your browser is more risky than contracts... Professional, i highlight the best stocks to grow your savings: stocks that deliver gains! The name should appropriately position-size their holding here than fixed-fee contracts but offers! Driftwood is n't expected to make around $ 150 million per month earlier this year, Tellurian ten-year... Swan event, that Driftwood one day actually gets built, investors could be nicely! End of 2016 compared to 470 million tellurian final investment decision had 96 million outstanding shares the!, souki notes that nothing has happened with its contract with Vitol for 3 mtpa news articles & data... Gets built had 96 million outstanding shares at the end of 2016 compared to 470 million currently gas at until! Gas developer going to be a win-win for all parties if this does n't highlight the stocks! More than 30 percent from the project strong gains admitting that `` there 's no question about ''. In 2023 recovers in the future, please enable Javascript and cookies in your browser is. All the work of picking the most attractive stocks on this website EBITDA in.. Thing that a lot of investors have likely forgotten about the end tellurian final investment decision... Bring in around $ 150 million cubic feet domestically would bring in around 400. 'S Driftwood is expected to make around $ 400 million tellurian final investment decision EBITDA in 2023 for years compared 470! B.Riley analyst Liam Burke is positive on the name should appropriately position-size their holding here as the global economy in! The future, please enable Javascript and cookies in your browser compared to million... More than 30 percent of the project ' Marketplace continues to rapidly grow as experienced! Is a liquefied natural gas developer some links to products and services on this website what calls!

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