Shares of the company have outperformed the industry in the past six months. The industry leader for online information for tax, accounting and finance professionals. 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. Altogether, Tellurian would need to dilute shareholders by approximately 7x. NGI All News Access. But does this mean it won't get built at all? However, the company missed the. read more. Copy and paste multiple symbols separated by spaces. | Other major company-specific developments have been the signing of its long-term contracts for uptake of potential production from its Driftwood project. 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. Tellurian's stock has been hit in the past few weeks, as rumors circulate about a loss of contract. 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. I am not receiving compensation for it (other than from Seeking Alpha). Going forward, a lot will depend on the FID. Amid the Driftwood progress and the overall price environment, what's the Tellurian (TELL) stock forecast for 2025? Driftwood LNG Plans Move Forward Despite Lack Of Financing. 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 . If indeed Tellurian did manage to raise $8 billion of debt, its interest payments would be at least 8%. "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. All three were shorter, 10-year deals at prices linked to the Title Transfer Facility and Japan-Korea Marker, making them riskier for lenders. Sign in to get the best natural gas news and data. Over the past 60 days, the Zacks Consensus Estimate for ConocoPhillips 2021 earnings has been raised by 22.5%. That would put its interest payments at close to $640 million. Driftwood is categorically not getting built by 2026. High upside energy, commodity, tech, and dividend stocks. At the FID point, major equipment orders are placed, and contracts are signed for EPC. Reuters, the news and media division of Thomson Reuters, is the worlds largest multimedia news provider, reaching billions of people worldwide every day. JKM WARNING: Any stocks that you feel like buying after discussions with me are your responsibility. 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. I strongly recommend no more than 3% of the portfolio for even the most concentrated investor. FID is the point in the capital project planning process when the decision to make major financial commitments is taken. High upside energy, commodity, tech, and dividend stocks. Headquartered in Houston, TX, Tellurian is a liquefied natural gas developer. Follow the topics you want and receive the daily emails. And yet, we are now in 2023, and this crucial milestone isn't even discussed. swan event, that Driftwood one day actually gets built. 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. 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. Unlike other U.S. supply deals that pass commodity risk through to offtakers, Tellurian would be exposed to the spread between domestic prices overseas prices. Some better-ranked players in the energy space are ConocoPhillips COP and Hess Corporation HES, each currently sporting a Zacks Rank #1 (Strong Buy). I provide a hand-holding service. Tellurian Inc . 2023 Natural Gas Intelligence. Presently, Tellurian's market cap is around $1 billion. 3/1/2023. By the start of 2020, several LNG export projects had already reached a final investment decision, putting . The concept is largely unproven in the U.S. export market, where deals have largely been tied to Henry Hub for terms of 20 years or more. 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. $6 billion from equity. Tellurian, email 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 believe that anyone reading this knows the spiel well. However, the company still needs to find gas feedstock and finances for the terminal. Haynesville Shale I have no business relationship with any company whose stock is mentioned in this article. Tellurian had 96 million outstanding shares at the end of 2016 compared to 470 million currently. Here's the thing that a lot of investors have likely forgotten about. Tellurian has said it plans to start preparing the Driftwood site for construction later this summer, with construction beginning in the first quarter of 2022. read more. Tellurian is reasonably well capitalized, with very roughly $400 million of net cash. I have no business relationship with any company whose stock is mentioned in this article. More specially, Souki notes that nothing has happened with its contract with Gunvor. I wrote this article myself, and it expresses my own opinions. 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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. I argue that this meaningfully improves the bull. Tellurian wanted all potential investors to be focused on the holy grail story. Tellurian has a compelling story that at some point in 2026, or now more realistically looking to be in 2027, it is going to build a massive export facility. The company had previously announced it hoped to achieve commerciality in the first quarter of 2022. LNG If Gunvor terminates the deal it would mark another setback for the Driftwood project, but Tellurian has again shifted its strategy for the terminal and is now looking to sell equity stakes to help it finance the project. Haynesville Shale Today, that discovery is still the heart of the Zacks Rank. This one is in the bag. These symbols will be available throughout the site during your session. In August, TELL did a secondary share offering worth $35 million. U.S. LNG exporters . Basically, Tellurian is now little more than a story stock without a meaningful contract and without its Final Investment Decision (''FID'') in place. Tellurian said that it has received most of the needed permits required for construction and operation with around 30% of the engineering already complete thanks to US$150 million of prior investments. LNG Type a symbol or company name. And that Tellurian could then further increase its total volume. for the stock will be the final investment decision for Driftwood, which has been pushed back . Souki remarks that the point of their game is not to get a contract signed at any cost, but to create shareholder value. 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. "They must feel the best way to get this project built is to by selling the offtake to traders, rather than [gas-producing] companies.". A story that's going to be a win-win for all parties. The company also reiterated that it is targeting a final investment decision for its LNG export facility in Texas before the end of the first quarter of 2023. THANK YOU for all the help that everyone has so kindly offered me, in how to think about businesses from different perspectives. Not only has Tellurian struggled to get its Final Investment Decision (''FID'') going for months. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers. Per the terms of the deal, TotalEnergies had an option to purchase 1.5 million tons per year of LNG from Tellurian. And anyone seriously considering this investment needs to keep that in mind and appropriately and prudently weigh it up in their portfolio. Indeed, domestic natural gas prices fell by nearly 20% to $6 MMBtu. Tellurian Inc., which continues to work toward a final investment decision on its Driftwood liquefied natural gas (LNG) terminal proposed for Louisiana, plans to acquire additional assets in the Haynesville Shale this year. Yet another problem. Tellurians high-risk/high-reward business plan hinges on the seamless integration of several moving parts, as well as high LNG prices and demand. That being said, in the past several days, natural gas prices on the spot market have been soaring back, and are now, once again, edging back to $7 MMBtu. Well, there's always hope. From the start, Tellurian has been a story stock. But common sense. 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. 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. Get them exclusively at Deep Value Returns. 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. Per Tellurian, the agreements have been canceled as they were not consistent with the commercial agreements that Driftwood signed with other companies. It will source upstream gas production from the Haynesville Basin in East Texas and Northwest Louisiana, which will be then be transported by the Driftwood pipeline to the Driftwood LNG export terminal and liquefaction facility in southwest Louisiana. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. See here for a complete list of exchanges and delays. Do Not Sell My Personal Information (CA Residents Only). I am not receiving compensation for it (other than from Seeking Alpha). Tellurian is one of several LNG developers that have put off making a final investment decision because it is tough to find customers in a world with low natural gas prices due to coronavirus . (Adds delay of final investment decision to Q1 2022 from 2021) May 27 (Reuters) - U.S . Is this happening to you frequently? It has $474.2 million in cash and cash equivalents on hand. ISSN 1532-1231 Saudi Arabia to Use $110 Billion Gas Field for Blue Hydrogen is tellurian going out of businessmagicycle accessories is tellurian going out of business. some value. Screen for heightened risk individual and entities globally to help uncover hidden risks in business relationships and human networks. As an experienced professional, I highlight the best stocks to grow your savings: stocks that deliver strong gains. This is not a hindsight remark. Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology. 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. 2023 ESG Review. In May, Tellurian agreed to supply 3 mtpa of LNG over a 10-year period to Gunvor Singapore. It is the second 10-year, 3-MTPA agreement Tellurian has announced in a week, following a deal with commodity trader Gunvor Group. "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. Since then, natural gas prices have been on a wild ride. Download now.]. 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