Tellurian, a natural gas company, was founded by Charif Souki and Martin Houston in 2016. Responsive Menu. Those assets produced 16.9 Bcf of natural gas last year, up from 13.9 Bcf in 2019. LNG Insight "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. We are all working together to compound returns. . One of the biggest stock catalysts remains the progress of its Driftwood project. 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. Per the now-terminated agreements, the company agreed to divest about 20 million shares of its common stock to TotalEnergies for around $200 million. I follow countless companies and select for you the most attractive investments. 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. 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: 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. Other major company-specific developments have been the signing of its long-term contracts for uptake of potential production from its Driftwood project. 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. No gimmicks. This would severely limit Tellurian's upside. I wrote this article myself, and it expresses my own opinions. The industry leader for online information for tax, accounting and finance professionals. 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. Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. 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. . All quotes delayed a minimum of 15 minutes. Sempra said this week it's finalizing funding for part of that project and hopes to make a final investment decision by the end of March. The Hartbeespoort dam in South Africa used to be brimming with people enjoying scenic landscapes and recreational water sports. High upside energy, commodity, tech, and dividend stocks. The stock has jumped by nearly 190 percent YTD but is off 30 percent from the highs it reached in June. Tellurian shares were trading around $4.42 per share, up about 0.4%, on Monday afternoon. When the symbol you want to add appears, add it to Watchlist by selecting it and pressing Enter/Return. Part of this decline is due to the companys share offering in August. JKM 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. | Reality got in the way. Not at less than $2 per share. Big Reserves Saudi Arabia has some of the world's biggest gas reserves, though they've mainly been used for the domestic market. Experts agree were still in the early stages of this technology, and as it grows, it will create several investing opportunities. 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 . If indeed Tellurian did manage to raise $8 billion of debt, its interest payments would be at least 8%. Bitcoin, Like the Internet Itself, Could Change Everything. 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. I strongly recommend no more than 3% of the portfolio for even the most concentrated investor. I'll address this momentarily. Souki remarks that the point of their game is not to get a contract signed at any cost, but to create shareholder value. Consequently, I declare that the demand for Tellurian's LNG facility couldn't possibly be higher and in more demand. See here for a complete list of exchanges and delays. I wrote this article myself, and it expresses my own opinions. Tellurian has been working toward a final investment decision on Driftwood, which the company said it thinks will cost $28.9 billion, for years. 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. 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. Now, the visitors are greeted to the sight of boats stuck in a sea of invasive green water hyacinth weed. Currently the company is on pace to produce 90mmBtu of natural gas up. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. 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. But more recently, Tellurian also saw two crucial contracts get canceled. For now, the company is primarily a natural gas producer with nearly 28,000 net acres in the Haynesville Shale of North Louisiana. You'll now be able to see real-time price and activity for your symbols on the My Quotes of Nasdaq.com. However, the company missed the deadline for sanctioning the project, which resulted in the termination of the deals. High-quality, actionable insightful stock picks. ISSN 2158-8023 See here for a complete list of exchanges and delays. 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. I do all the work of picking the most attractive stocks. The partners were to receive LNG from the project. As per usual, Souki took to YT to argue his take. 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. It's not just an out-of-the-money option. Another big fear for investors could be the dilution of their holdings. According to Tellurian, Driftwood LNG will create approximately 6500 construction jobs and 400 operational jobs. "They must feel the best way to get this project built is to by selling the offtake to traders, rather than [gas-producing] companies.". Washington DC | New York | Houston | Pittsburgh | Mexico City Calgary | Chile. Zacks->. Total also will purchase about 20 million additional. We are all working together to compound returns. 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 Inc. TELL terminated agreements with TotalEnergies TTE related to its Driftwood Liquefied Natural Gas (LNG) production and export terminal in Louisiana, according to a securities filing. In June, TELL signed a long-term contract with Vitol for 3 mtpa. Our Standards: The Thomson Reuters Trust Principles. 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. LNG Is this happening to you frequently? 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. 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. Tellurian, email 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. info@naturalgasintel.com 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. Tellurian, email According to the consensus compiled by MarketBeat, Tellurian is covered by seven analysts. 1.800.427.5747 Tellurian has yet to secure financing for the entirety of the Driftwood LNG project. Now, the visitors are greeted to the sight of boats stuck in a sea of invasive green water hyacinth weed. 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. High upside energy, commodity, tech, and dividend stocks. As a reference point, Cheniere is also priced very roughly at 4x next year's EBITDA! Gas producer . 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. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. 2023, Nasdaq, Inc. All Rights Reserved. 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. Over the past decade, it has made growing its natural gas trading, production, and supply business a key priority. All Rights Reserved. Looking for a portfolio of ideas like this one? Zacks Equity Research for I provide a hand-holding service. People may receive compensation for some links to products and services on this website. This is not a significant dilution and amounts to less than 4%. 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. Tellurian is based in Houston, Texas, and its common stock is listed on the Nasdaq Capital Market under the symbol "TELL." Tellurian clearly has assets with some value. And yet, we are now in 2023, and this crucial milestone isn't even discussed. I believe that anyone reading this knows the spiel well. Going on to state that there's plenty of interest from private equity to get involved in the sector. Tellurian issued a second press release today, saying that it had exercised its. Is this happening to you frequently? 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's LNG facility is clearly in high demand and can't possibly arrive quickly enough. To get to Final Investment Decision, Tellurian needs to secure additional natural gas assets in the Haynesville shale. Members of Deep Value Returns get exclusive access to our model portfolio. Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology. 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. 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. | Liquefied Natural Gas Tellurian needs to raise $12 billion. Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. On the other hand, if the stars aligned, and Driftwood gets built, investors could be very nicely rewarded. Plus regular stock updates. 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. If you have an ad-blocker enabled you may be blocked from proceeding. In 2021, Tellurian reported $27 million in first quarter losses and terminated a $700 million deal with TotalEnergies, after Tellurian failed once again to reach a final investment decision for Driftwood. But in case those risks were forgotten, today everyone has been reminded. It's not just an out-of-the-money option. 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. The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs. The Vitol and Gunvor deals were indexed to a combination of the Japan Korea Marker (JKM) , which is trading near $11 per million British thermal units (mmBtu), and the Dutch Title Transfer Facility (TTF) , which is trading close to its highest since September 2018. The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs. I follow countless companies and select for you the most attractive investments. 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. Tellurians Driftwood LNG is arguably the single most ambitious US LNG 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. Days before the Shell and Vitol deals were canceled, Tellurian announced that it had withdrawn a high-yield bond sale, citing the impacts of inflation and uncertainty in the debt market. View Subscription Options Souki calls Driftwood the holy grail of the business model (~3:42). If you have an ad-blocker enabled you may be blocked from proceeding. I argue that this meaningfully improves the bull. June 3 (Reuters) - U.S. liquefied natural gas (LNG) developer Tellurian Inc (TELL.O) said on Thursday it had signed a 10-year sale and purchase agreement with commodity trader Vitol for 3 million tonnes per annum (MTPA) of LNG. The ongoing natural gas market recovery has made many analysts turn bullish on the companys stock. Even if there's undoubtedly a lot of appetite to service the LNG market in Europe and Asia, translating this appetite into funding for. Looking for a helping hand in the market? By using this Site or clicking on "OK", you consent to the use of cookies. A win for shareholders, as their business will be generating robust free cash flows. Indeed, what can go wrong? |, Related topics: Phase 1 will consist of three plants with a combined capacity of 16.5 MTPA and an expected cost of US$16.8 billion. This is of course if Driftwood ends up getting built at all. Souki discusses that inflation and rapidly rising interest rates have made raising debt on anything but the most onerous terms impossible. This is a simple case of arbitrage. It's also developing an LNG trading operation and infrastructure that includes a 27.6 mtpa (million tons per annum) LNG export facility and an associated pipeline, known as Driftwood. Tellurian has no signed Final Investment Decision. 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." Tellurian Inc . Two-thirds debt to one-third equity. | 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. If this doesn't highlight the need for another large LNG facility, very little will. "This activity has pushed a host of pre-final-investment-decision U.S. projects forward and we could see a wave of FIDs this year and next," he said in a report emailed to UPI. In May, Tellurian agreed to supply 3 mtpa of LNG over a 10-year period to Gunvor Singapore. To read this article on Zacks.com click here. For online information for tax, accounting and finance professionals of debt, its interest payments would at! Insights from worldwide sources and experts free cash flows that anyone reading knows. Agreed to supply 3 mtpa of LNG over a 10-year period to Gunvor Singapore key priority compliance needs gas,! In high demand and ca n't possibly be higher and in more demand symbol you want add... 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