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. You have 3 free articles remaining. The company had previously announced it hoped to achieve commerciality in the first quarter of 2022. Tellurian stock has been pumped up this year due to rising natural gas prices and the meme crowd. I am not receiving compensation for it (other than from Seeking Alpha). [2023 Natural Gas Price Outlook: How will the energy industry continue to evolve in 2023? Over the past 60 days, the Zacks Consensus Estimate for ConocoPhillips 2021 earnings has been raised by 22.5%. The SPA is for the purchase of LNG free on board at a price based on the Platts Japan Korea Marker. 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. That those contracts are not what the business model is about. Access unmatched financial data, news and content in a highly-customised workflow experience on desktop, web and mobile. I am not receiving compensation for it (other than from Seeking Alpha). Today, that discovery is still the heart of the Zacks Rank. However, let's make the argument that Tellurian ends up raising the FID with 80% equity and 20% debt. If this doesn't highlight the need for another large LNG facility, very little will. Tellurian wanted all potential investors to be focused on the holy grail story. Gunvor In a video posted yesterday, Tellurian's Charif Souki explained why Tellurian had not felt comfortable in committing the remaining 2 million tonnes of its 11 million tonnes per year facility. Presently, Tellurian's market cap is around $1 billion. The sales and purchase agreement (SPA) was amended to give Gunvor the option of walking away if Tellurian failed to meet conditions, including sanctioning the Driftwood project and securing financing by Feb. 28. 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. Tellurian said it intends to market up to 10 million tpy of its 16.6-million tpy Phase 1 on a JKM . The LNG would come from Tellurian's proposed 27.6-MTPA Driftwood export project in Louisiana. Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. 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. Two-thirds debt to one-third equity. Copyright 2023 Market Realist. The industry leader for online information for tax, accounting and finance professionals. I am not receiving compensation for it (other than from Seeking Alpha). Tellurian CEO Octvio Simes said the company "continues to execute on our plan to market Driftwood LNG volumes on indices that our customers want.". Up until the Final Investment Decision takes place, investors are left guessing as to just how much equity will be diluted. And yet, we are now in 2023, and this crucial milestone isn't even discussed. Looking for a helping hand in the market? I have no business relationship with any company whose stock is mentioned in this article. A wealth of resources for individual investors is available at www.zacks.com. The partners were to receive LNG from the project. This I already discussed in my previous bullish article. WARNING: Any stocks that you feel like buying after discussions with me are your responsibility. Souki declares that Driftwood's schedule is now pushed back, admitting that ''there's no question about that'' (4:57). This is a simple case of arbitrage. This article provides a discussion of the bull and bear cases facing Tellurian. Tellurian has no signed Final Investment Decision. 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. FIND OUT MORE Downstream capabilities View our downstream services Insights Amid the Driftwood progress and the overall price environment, what's the Tellurian (TELL) stock forecast for 2025? Looking for more investing ideas like this one? 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. Tellurian clearly has assets with some value. The company estimates that the 27.6 mmty facility would cost $25 billion to build. However, Tellurian yesterday guided that it would expect to see $400 million of EBITDA in 2023. Click here to request a trial. If you have an ad-blocker enabled you may be blocked from proceeding. Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. The difference between selling 150 million cubic feet domestically would bring in around $35 million in revenues per month. No gimmicks. One of the biggest stock catalysts remains the progress of its Driftwood project. 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. Now, the visitors are greeted to the sight of boats stuck in a sea of invasive green water hyacinth weed. As an experienced professional, I highlight the best stocks to grow your savings: stocks that deliver strong gains. 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 . But common sense. Earlier this year, Tellurian signed ten-year agreements with commodity traders Gunvor Group and Vitol to sell three million tons per annum of LNG. It also cut jobs, corporate spending and expenses related to the first phase of the project. That would put its interest payments at close to $640 million. Type a symbol or company name. "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 LNG terminal is expected to cost $12 billion. 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. | Those assets produced 16.9 Bcf of natural gas last year, up from 13.9 Bcf in 2019. And looking out to next year, Tellurian is expected to make around $400 million of EBITDA. 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. The Hartbeespoort dam in South Africa used to be brimming with people enjoying scenic landscapes and recreational water sports. But does this mean it won't get built at all? McKinsey uses cookies to improve site functionality, provide you with a better browsing experience, and to enable our partners to advertise to you. 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 agreements were subject to the relevant regulatory approvals and Tellurian had to make a final investment decision for the project by Jul 10, 2021. FID Also known as: Final investment decision FID is the point in the capital project planning process when the decision to make major financial commitments is taken. The bigger question is what LNG prices will be in 2026. Type a symbol or company name. Tellurian has no signed Final Investment Decision. Tellurian had 96 million outstanding shares at the end of 2016 compared to 470 million currently. Tellurian is in a strong financial position with substantial liquidity after taking on expense reduction activities and significant debt reduction measures in 2020, and subsequent prepayments in 2021, CEO Octvio Simes said last week after the company released 2020 results. 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. Our Standards: The Thomson Reuters Trust Principles. Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. This clearly is super advantageous to Cheniere (LNG). 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 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. See here for a complete list of exchanges and delays. On Nov. 29, the company and former President and CEO Meg. However, the company missed the. It has $474.2 million in cash and cash equivalents on hand. Zacks->. That would lower its debt payments, but it would also cap shareholders' 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 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. One of the major catalysts has been the overall buoyant LNG prices due to the ongoing recovery across the world. Members of Deep Value Returns get exclusive ideas and guidance to navigate any climate. This is of course if Driftwood ends up getting built at all. 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: The first phase would have a nameplate production capacity of 11 million mt/y per year of LNG. Building its highly coveted Driftwood will cost $14 billion. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. People may receive compensation for some links to products and services on this website. Both companies had a contractual right to nix their deals after the company failed to meet a July 31 deadline on a final investment decision that could have paved the way for construction to begin . When the symbol you want to add appears, add it to My Quotes by selecting it and pressing Enter/Return. Tellurian said it planned to make a final investment decision on its $30 billion Driftwood project, which includes pipelines and production fields in addition to the liquefaction plant, in. However, it has contracted a total of 9 MTPA worth of sale and purchase agreements (SPAs). Tellurian has an amazing story. In May 2021, Tellurian secured the first two SPAs, one with Vitol, a commodity trading firm, and the second with Gunvor, the largest independent global trader of LNG by volume. 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