When Tullow Oil pushed out its chief executive and head of exploration on Monday, slashing its production forecasts and scrapping its dividend in the process, its board knew it would have to face the wrath of disappointed investors.
But they could not have imagined the scale of the revolt, with a near 70 per cent share price collapse in the FTSE 250 oil and gas explorer ranking as one of the worst single day performances by a significant London-listed company this decade. More than £1.4bn was wiped off Tullow’s market capitalisation, valuing the company that was once worth more than £14bn at a little over £560m.
bye CEO, bye exploration director, bye money
Trading statement coming on Wednesday 15th January.
I was going to buy the dip but I was traveling and thankfully unable the buy.
Basically they had this super hyped Guyana well that turned out it was commerciality not certain. They plugged the well and abandoned it.
Quite a fall from £1.80 at the start of last year.
Anyone fancying it at the current price?
I bought some last week. It could just be a buy and hold. If it drops I will buy more.
I hold off for now. Let’s see what the Wednesday trading update brings!
I know the community likes sustainable energy shares, but I think oil remains big and provides good investment opportunities.
Sustainable energy is my long term investment with anything in oil etc being more of a mid term investment.
I think the infrastructure is still many years behind getting to a point where we can make big movements away from fossil fuels.
I expect there to be a big opportunity at some point where enthusiasm over renewables and shifting away from fossil fuels causes oil companies to be unduly written off and valued at much less than the amount of value they’ll be able to extract meeting the world’s energy needs even if a significant transition to renewables happen. A declining industry that will produce £x cash flow before ceasing operations, but valued at 10% of x because it’s a declining industry. I dont think we’re anywhere near that low point yet.
Big write down:
Not looking good for them…
Trading update today but the big news was the sale of Uganda interests for for $575 million in cash which is being used to pay down the debt.