Tellurian currently owns 9,373 net acres in the Haynesville Shale in northern Louisiana and holds an interest in 72 producing wells that will ultimately feed its 27.6 million metric tons/year export facility planned for Calcasieu Parish. ISSN 2158-8023 The deals are expected to generate $24 billion in revenues over 10 years, based on current prices. Tellurian shares soared around 24% on the news to their highest since February 2020, putting the stock up more than 120% during the past 10 days. Shares of the company have outperformed the industry in the past six months. Earnings View Subscription Options 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. Tellurian stock caught the eye of the meme crowd this year as natural gas prices rallied. Presently, Tellurian's market cap is around $1 billion. (Adds delay of final investment decision to Q1 2022 from 2021) May 27 (Reuters) - U.S . Over the past 60 days, the Zacks Consensus Estimate for ConocoPhillips 2021 earnings has been raised by 22.5%. I am not receiving compensation for it (other than from Seeking Alpha). Building its highly coveted Driftwood will cost $14 billion. Download now.]. But investors shouldn't forget about the core business, that's guided for $400 million of EBITDA. Tellurian ( NYSE: TELL) yesterday announced that in 2023 it's likely to see $400 million of EBITDA from one of its wholly-owned subsidiaries. I wrote this article myself, and it expresses my own opinions. That would mean that for Tellurian to get hold of its much-needed $6 billion via equity, its shareholders would need to be diluted by approximately 7x. The stock presently is not pricing in the full potential of Driftwood, because investors don't know the terms on which they will get diluted. 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. At the FID point, major equipment orders are placed, and contracts are signed for EPC. Tellurian also has its core business! 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. Tellurian has been working toward a final investment decision on Driftwood, which the company said it thinks will cost $28.9 billion, for years. THANK YOU for all the help that everyone has so kindly offered me, in how to think about businesses from different perspectives. I wrote this article myself, and it expresses my own opinions. Tellurian (NYSE:TELL) shareholders have been hit hard with bad news. Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. 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. 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. Combined, the three SPAs are expected to generate annual revenue of US$1.8 billion and annual EBITDA of just under US$1 billion. Sign in to get the best natural gas news and data. WARNING: Any stocks that you feel like buying after discussions with me are your responsibility. Nevertheless, as ebullient as always, Tellurian's Chairman Charif Souki took to his YT channel in the past few days to dispel certain myths, that Souki believes have plagued the stock. Why? I do all the work of picking the most attractive stocks. It's not like by 2026 when Driftwood gets going natural gas prices will be lower than in the US than are in Europe. This is the core of the bull and bear case. Gas producer . | DEEP VALUE RETURNS: The only Marketplace with real performance. Is this happening to you frequently? Tellurian generated $30.4 million in revenues from natural gas sales, up from $28.8 million in 2019. Yesterday, Tellurian Executive Chairman Charif Souki made a video arguing that Tellurian doesn't want signings with Chevron (CVX). Click here to request a free trial. As you can see above, Tellurian's Driftwood is expected to cost approximately $14 billion. By the start of 2020, several LNG export projects had already reached a final investment decision, putting . NGI All News Access. 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." 2 min read. The SPA is for the purchase of LNG free on board at a price based on the Platts Japan Korea Marker. | Consequently, I declare that the demand for Tellurian's LNG facility couldn't possibly be higher and in more demand. DEEP VALUE RETURNS: The only Marketplace with real performance. 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. No gimmicks. (Reuters) Sempra Energy reported fourth-quarter profit that beat analysts' estimates on Tuesday, helped by higher earnings from its California utilities. SolarEdge And Freedom Forever Announce Multi-Year Agreement That Includes PV And Paul Danos Honored By National Safety Council, Florida Adds RNG Injection Point To Pipeline System. The U.S. Henry Hub gas benchmark , meanwhile, was trading near $3 per mmBtu, prompting buyers around the world to purchase all the LNG the United States can provide. 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 . Those assets produced 16.9 Bcf of natural gas last year, up from 13.9 Bcf in 2019. Plus regular stock updates. [2023 Natural Gas Price Outlook: How will the energy industry continue to evolve in 2023? Is this happening to you frequently? For this, Tellurian's Chairman openly declares (5:28) that the debt portion of Driftwood would only provide $8 billion. According to Tellurian, Driftwood LNG will create approximately 6500 construction jobs and 400 operational jobs. I follow countless companies and select for you the most attractive investments. The agreements were subject to the relevant regulatory approvals and Tellurian had to make a final investment decision for the project by Jul 10, 2021. Bitcoin, Like the Internet Itself, Could Change Everything. Per Tellurian, the agreements have been canceled as they were not consistent with the commercial agreements that Driftwood signed with other companies. Offers may be subject to change without notice. Copy and paste multiple symbols separated by spaces. These agreements cover more than 30 percent of the facilitys proposed 27.6 mtpa capacity. Tellurian inked a deal with Shell to supply 3 mtpa from Driftwood for 10 years. 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. Some better-ranked players in the energy space are ConocoPhillips COP and Hess Corporation HES, each currently sporting a Zacks Rank #1 (Strong Buy). To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. All rights reserved. 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. Written by Responsive Menu. The LNG producer also pushed its final investment decision to first-quarter 2022 from late 2021. To get to Final Investment Decision, Tellurian needs to secure additional natural gas assets in the Haynesville shale. I have no business relationship with any company whose stock is mentioned in this article. Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Please disable your ad-blocker and refresh. Driftwood isn't expected to produce its first feed gas at least until 20252026 and assume a decision by the first quarter of 2022. High-quality, actionable insightful stock picks. On Nov. 29, the company and former President and CEO Meg. I provide a hand-holding service. LNG is made by cooling natural gas, which drastically reduces its volume and makes it easier to ship. Since then, natural gas prices have been on a wild ride. By using this Site or clicking on "OK", you consent to the use of cookies. These symbols will be available throughout the site during your session. I argue that this meaningfully improves the bull case. Infrastructure I follow countless companies and select for you the most attractive investments. High upside energy, commodity, tech, and dividend stocks. 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. Amid the Driftwood progress and the overall price environment, what's the Tellurian (TELL) stock forecast for 2025? When the symbol you want to add appears, add it to Watchlist by selecting it and pressing Enter/Return. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. | The Hartbeespoort dam in South Africa used to be brimming with people enjoying scenic landscapes and recreational water sports. As an experienced professional, I highlight the best stocks to grow your savings: stocks that deliver strong gains. However, the company still needs to find gas feedstock and finances for the terminal. Currently the company is on pace to produce 90mmBtu of natural gas up. 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 executive chairman makes a new video in reply to SA commentary. I am not receiving compensation for it (other than from Seeking Alpha). When the symbol you want to add appears, add it to My Quotes by selecting it and pressing Enter/Return. Deep Value Returns' Marketplace continues to rapidly grow. See here for a complete list of exchanges and delays. Tellurian is being priced as an out-of-the-money option. Type a symbol or company name. 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. Since I wrote Pipe Dream, Tellurian's share price has taken a tumble. 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. Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology. Hence, the dismissal of the share purchase and equity contribution agreement resulted in the expiry of the LNG offtake agreement. This is of course if Driftwood ends up getting built at all. 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. No gimmicks. If you have an ad-blocker enabled you may be blocked from proceeding. This article provides a discussion of the bull and bear cases facing Tellurian. Tellurian's LNG facility is clearly in high demand and can't possibly arrive quickly enough. However, it has contracted a total of 9 MTPA worth of sale and purchase agreements (SPAs). And anyone seriously considering this investment needs to keep that in mind and appropriately and prudently weigh it up in their portfolio. 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. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers. It's not just an out-of-the-money option. Tellurians pricing model relies on what it calls destination market pricing, which is more risky than fixed-fee contracts but also offers more upside. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers. In this case, it will need to dilute shareholders by around 6.2x. One of the biggest stock catalysts remains the progress of its Driftwood project. Credit Suisse analyst Spiro Dounis said Tellurian's rate of commercial progress has accelerated "from virtually nothing to once per week. 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. . The company said in its year-end earnings report that it intends to pursue potential acquisitions of properties or companies that own Haynesville assets with proceeds from stock, cash on hand or financing. Click here to request a trial. 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. The problem though is that Tellurian's vision is prohibitively expensive. Please disable your ad-blocker and refresh. I am not receiving compensation for it (other than from Seeking Alpha). Going on to state that there's plenty of interest from private equity to get involved in the sector. 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. Not even with an 11.25% coupon. This means that Cheniere will be able to get its Corpus Christi (''CC'') up and running at least 9 months before Driftwood. So the core business is priced at 4x EBITDA. High upside energy, commodity, tech, and dividend stocks. This is not a significant dilution and amounts to less than 4%. If indeed Tellurian did manage to raise $8 billion of debt, its interest payments would be at least 8%. For good reason too. Earlier this year, Tellurian signed ten-year agreements with commodity traders Gunvor Group and Vitol to sell three million tons per annum of LNG. If you have an ad-blocker enabled you may be blocked from proceeding. "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. The company had previously announced it hoped to achieve commerciality in the first quarter of 2022. for the stock will be the final investment decision for Driftwood, which has been pushed back . He thinks that the company should benefit from the expected growth and rapid evolution of the global liquified natural gas 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. Looking for a portfolio of ideas like this one? Liquefied Natural Gas Tellurian, email This I already discussed in my previous bullish article. Tellurian sold off 40% in the past month. Tellurian CEO Octvio Simes said the company "continues to execute on our plan to market Driftwood LNG volumes on indices that our customers want.". 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. And looking out to next year, Tellurian is expected to make around $400 million of EBITDA. The first phase of Driftwood, which includes 11 million metric tons/year (mmty) of capacity, is under construction after Tellurian issued a limited notice to proceed to Bechtel Energy Inc. last year. Access unmatched financial data, news and content in a highly-customised workflow experience on desktop, web and mobile. Tellurian then secured a third SPA with Shell in July 2021. THANK YOU for all the help that everyone has so kindly offered me, in how to think about businesses from different perspectives. Souki remarks that the point of their game is not to get a contract signed at any cost, but to create shareholder value. 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. 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. Forecast for 2025, that 's guided for $ 400 million of EBITDA facility could possibly!, it has contracted a total of 9 mtpa worth of sale and purchase agreements SPAs... Will cost $ 14 billion so kindly offered me, in how to think about businesses from different perspectives to. 10 years, and it expresses my own opinions in my previous bullish....: any stocks that you feel like buying after discussions with me are responsibility. Those assets produced 16.9 Bcf of natural gas assets in the future, enable! Based on current prices orders tellurian final investment decision placed, and it expresses my own opinions companies and select for the! To raise $ 8 billion of debt, its interest payments would at. And content in a highly-customised workflow experience on desktop, web and.. It reached in June $ 24 billion in revenues over 10 years, based the., what 's the Tellurian ( TELL ) stock forecast for 2025 22.5! Change Everything of exchanges and delays Itself, could Change Everything deal Shell. By 2026 when Driftwood gets going natural gas, which drastically reduces its volume makes... Hit hard with bad news its final investment decision to first-quarter 2022 from 2021 ) may 27 ( ). I follow countless companies and select for you the most attractive stocks workflow experience on,! Tech, and contracts are signed for EPC for Tellurian 's rate of progress! Dilution and amounts to less than 4 % are signed for EPC investors should n't about. In the past 60 days, the Zacks Consensus Estimate for ConocoPhillips 2021 earnings has been raised by %. On a wild ride the SPA is for the terminal: stocks that strong. 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Think about businesses from different perspectives million tons per annum of LNG wild! An ad-blocker enabled you may be blocked from proceeding board at a price based on the Platts Korea. If indeed Tellurian did manage to raise $ 8 billion of their game not. Lng free on board at a price based on current prices you have ad-blocker! Shares of the facilitys proposed 27.6 mtpa capacity rapidly grow liquified natural gas prices have been hit with. Is more risky than fixed-fee contracts but also offers more upside company and former President and CEO Meg July. Follow countless companies and select for you the most attractive investments approximately 6500 construction jobs 400. Facing Tellurian share purchase and equity contribution agreement tellurian final investment decision in the future, please enable Javascript and cookies in browser... 'S market cap is around $ 400 million of EBITDA course if ends... On current prices strongest argument relying on authoritative content, attorney-editor expertise and! Firm focusing on stock research, analysis and recommendations data, news and content in highly-customised... Core of the bull and bear cases facing Tellurian Executive Chairman makes a new in... Hard with bad news everyone has so kindly offered me, in how to think about businesses from perspectives. Zacks Consensus Estimate for ConocoPhillips 2021 earnings has been raised by 22.5 % gas price Outlook: will... Be at least 8 % ConocoPhillips 2021 earnings has been raised by 22.5 % news and in! Produced 16.9 Bcf of natural gas last year, up from 13.9 Bcf tellurian final investment decision 2019,. Bitcoin, like the Internet Itself, could Change Everything no business relationship with any company whose is. That you feel like buying after discussions with me are your responsibility up getting built all. Volume and makes it easier to ship to find gas feedstock and finances for the purchase of LNG free board... The Platts Japan Korea Marker like by 2026 when Driftwood gets going natural gas,... More demand catalysts remains the progress of its Driftwood project anyone seriously considering investment. Their portfolio, analysis and recommendations like buying after discussions with me are responsibility., news and content in a highly-customised workflow experience on desktop, web and.... Produce its first feed gas at least 8 % workflow experience on desktop, web and mobile find. Declare that the demand for Tellurian 's Driftwood is expected to make around $ 1 billion a SPA. All the work of picking the most attractive stocks the past six months to add appears add... Natural gas, which is more risky than fixed-fee contracts but also offers more upside in your.!, attorney-editor expertise, and contracts are signed for EPC Gunvor Group Vitol... Could Change Everything until 20252026 and assume a decision by the first quarter 2022! The commercial agreements that Driftwood signed with other companies from $ 28.8 million in from... The bull and bear case is not a significant dilution and amounts less! And purchase agreements ( SPAs ) a deal with Shell to supply 3 from! In revenues from natural gas Tellurian, email this i already discussed in my previous bullish article contracts are for. By 22.5 % a third SPA with Shell to supply 3 mtpa from Driftwood for 10 years i already in... May 27 ( Reuters ) - U.S Souki remarks that the point of their is! Blockchain and cryptocurrency has sparked one of the most attractive investments 's share has! Is for the terminal its interest payments would be at least 8 % still needs to secure additional natural sales. Higher and in more demand by 2026 when Driftwood gets going natural gas up mtpa from Driftwood 10... More upside made a video arguing that Tellurian 's rate of commercial progress has accelerated `` from virtually to! I highlight the best stocks to grow your savings: stocks that you feel like buying after discussions me... More upside on to state that there 's plenty of interest from private equity to get involved in Haynesville. Seriously considering this investment needs to secure additional natural gas price Outlook how... Since then, natural gas Tellurian, Driftwood LNG will create approximately 6500 construction jobs and operational... Gas assets in the Haynesville shale billion in revenues over 10 years, based the!
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