Tellurian also has its core business! 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. 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. 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. The LNG would come from Tellurian's proposed 27.6-MTPA Driftwood export project in Louisiana. Building its highly coveted Driftwood will cost $14 billion. DEEP VALUE RETURNS: The only Marketplace with real performance. 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 . You'll now be able to see real-time price and activity for your symbols on the My Quotes of Nasdaq.com. A wealth of resources for individual investors is available at www.zacks.com. $8 billion to come from debt. Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. | 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. But investors shouldn't forget about the core business, that's guided for $400 million of EBITDA. This means that investors simply aren't buying into Souki's vision. Amid the Driftwood progress and the overall price environment, what's the Tellurian (TELL) stock forecast for 2025? Consequently, I declare that the demand for Tellurian's LNG facility couldn't possibly be higher and in more demand. 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. LNG This is not a significant dilution and amounts to less than 4%. 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. Offers may be subject to change without notice. Click here to request a free trial. I am not receiving compensation for it (other than from Seeking Alpha). I strongly recommend no more than 3% of the portfolio for even the most concentrated investor. Type a symbol or company name. I argue that this meaningfully improves the bull. Tellurian Inc.'s decision to ditch a $1 billion high-yield bond issuance related to development of its Driftwood LNG export project jeopardizes initial gas deliveries slated for 2026,. 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. Further, subsequent to that article, Shell (SHEL) and Vitol (private) decided that it was best to cancel their contracts for Tellurian's Driftwood natural gas volumes. | Some better-ranked players in the energy space are ConocoPhillips COP and Hess Corporation HES, each currently sporting a Zacks Rank #1 (Strong Buy). Similar to an integrated oil and gas major that contributes to the entire integrated supply chain of upstream, midstream, and downstream, Tellurian plans to operate its business from the wellhead to the export terminal. To build Driftwood, a large, fully integrated LNG facility. But does this mean it won't get built at all? Today, that discovery is still the heart of the Zacks Rank. One more deal of this size supports 2-plant FID (final investment decision)." Tellurian has said the first phase of Driftwood would cost about $16.8 billion and produce about 16.5 MTPA of LNG. 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." Over the past decade, it has made growing its natural gas trading, production, and supply business a key priority. Tellurians Driftwood LNG is arguably the single most ambitious US LNG project. This clearly is super advantageous to Cheniere (LNG). 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. Written by Now, the visitors are greeted to the sight of boats stuck in a sea of invasive green water hyacinth weed. 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. (Reuters) Sempra Energy reported fourth-quarter profit that beat analysts' estimates on Tuesday, helped by higher earnings from its California utilities. A story that's going to be a win-win for all parties. And the debt markets would not even consider $1 billion. But investors crave FID details. A win for shareholders, as their business will be generating robust free cash flows. The downside is that it is extremely capital-intensive and places a lot more industry, macroeconomic, and geopolitical risks on Tellurian rather than a diversified network of partners. I wrote this article myself, and it expresses my own opinions. It is the second 10-year, 3-MTPA agreement Tellurian has announced in a week, following a deal with commodity trader Gunvor Group. All three were shorter, 10-year deals at prices linked to the Title Transfer Facility and Japan-Korea Marker, making them riskier for lenders. |, Related topics: LNG The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs. You have 3 free articles remaining. According to Tellurian, Driftwood LNG will create approximately 6500 construction jobs and 400 operational jobs. We are all working together to compound returns. I have no business relationship with any company whose stock is mentioned in this article. | You can seethe complete list of todays Zacks #1 Rank stocks here. Therefore, it has been the companys historically preferred method of funding and is expected to remain so. That those contracts are not what the business model is about. Saudi Arabia to Use $110 Billion Gas Field for Blue Hydrogen Souki contends that the reason why Tellurian was not at the discussion table with Chevron had been that Tellurian didn't want to be in a position to overpromise and underdeliver on its contract. Tellurian shares were trading around $4.42 per share, up about 0.4%, on Monday afternoon. Tellurian (NYSE:TELL) remains a highly speculative stock. 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. Do Not Sell My Personal Information (CA Residents Only). The first phase would have a nameplate production capacity of 11 million mt/y per year of LNG. Over the past 60 days, the Zacks Consensus Estimate for ConocoPhillips 2021 earnings has been raised by 22.5%. The company ended 2020 with $78.3 million of cash and cash equivalents and $72.8 million in short-term borrowings. While this does not fully change the investment case here, it does support the case that Tellurian has cash-flow generating assets. Get access to 100,000+ more news articles & industry data. 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. 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. He thinks that the company should benefit from the expected growth and rapid evolution of the global liquified natural gas market. Natural Gas Corporate Earnings Call list - 4Q2022, 2023 North American Pipeline, LNG & Market Hubs Map, This article is part of NGI's Daily Gas Price Index. 1.800.427.5747 All quotes delayed a minimum of 15 minutes. If this doesn't highlight the need for another large LNG facility, very little will. ISSN 2158-8023 Please disable your ad-blocker and refresh. Plus regular stock updates. Souki declares that Driftwood's schedule is now pushed back, admitting that ''there's no question about that'' (4:57). 1.800.427.5747 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 industry leader for online information for tax, accounting and finance professionals. 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. Tellurian is based in Houston, Texas, and its common stock is listed on the Nasdaq Capital Market under the symbol "TELL." 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. B.Riley initiated on TELL with a buy rating and a target price of $8 in July. Our Standards: The Thomson Reuters Trust Principles. Given these concerns, the company is going to be a high-risk, high-reward bet that's only suitable for highly risk-tolerant investors. 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. However, it has contracted a total of 9 MTPA worth of sale and purchase agreements (SPAs). JKM Download now.]. By the start of 2020, several LNG export. Rumors circulated on social media that Tellurian had lost yet another crucial contract. LNG Insight Looking for a helping hand in the market? Tellurian has said the first phase of Driftwood would cost about $16.8 billion and produce about 16.5 MTPA of LNG. ConocoPhillips (COP): Free Stock Analysis Report, Hess Corporation (HES): Free Stock Analysis Report, Magellan Petroleum Corporation (TELL): Free Stock Analysis Report, TotalEnergies SE Sponsored ADR (TTE): Free Stock Analysis Report. Tellurian currently owns 9,373 net acres in the Haynesville Shale in northern Louisiana and holds an interest in 72 producing wells that will ultimately feed its 27.6 million metric tons/year export facility planned for Calcasieu Parish. I believe that anyone reading this knows the spiel well. Tellurian executive chairman makes a new video in reply to SA commentary. Great chart showing how coal prices should increase with LNG prices.$LNG $TELL $TGA $BTU $AR $CRK https://t.co/SazUOygfKk. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Tellurian said it intends to market up to 10 million tpy of its 16.6-million tpy Phase 1 on a JKM . To read this article on Zacks.com click here. Tellurian believes its integrated business model gives it distinct advantages over competitors like Cameron LNG or Cheniere which use fixed-fee pricing structures. 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. Driftwood LNG Plans Move Forward Despite Lack Of Financing. 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. Members of Deep Value Returns get exclusive ideas and guidance to navigate any climate. Not even with an 11.25% coupon. Combined, the three SPAs are expected to generate annual revenue of US$1.8 billion and annual EBITDA of just under US$1 billion. Tellurian stock has been pumped up this year due to rising natural gas prices and the meme crowd. Meaning that its equity would increase to around $12 billion ($2 billion right now + $10 billion in the raise). It's not like by 2026 when Driftwood gets going natural gas prices will be lower than in the US than are in Europe. WARNING: Any stocks that you feel like buying after discussions with me are your responsibility. 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. Deep Value Returns' Marketplace continues to rapidly grow. Plus regular stock updates. High-quality, actionable insightful stock picks. 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. These symbols will be available throughout the site during your session. As an experienced professional, I highlight the best stocks to grow your savings: stocks that deliver strong gains. 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