Tellurian Inc. (TELL) stock announced the finalizing of liquified natural gas (LNG) sales and purchase agreement with Vitol Inc. after which the TELL stock happened to be green today on June 3, 2021, and its stock price saw an uptrend of 32.79% to reach at $5.75 a share as of this writing. Prior to this announcement, TELL stock suffered a drop of 9.79% at the previous closing. Let’s discuss more about it.
Tellurian Long-Term Agreements
TELL stock became bullish after the announcement of LNG sales and purchase agreement between Tellurian and Vitol. Three million tons per annum LNG is projected for this LNG agreement and is valid for a 10-year period with a value of approximately $12 billion.
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In recent years, the demand for LNG has been increased drastically in order to meet the energy needs across the globe. This is the reason that countries like China and India have bought more super cool while getting rid of consumers off dirtier coal.
On June 1, 2021, signed a long-term agreement with Gunvor Singapore Pte Ltd pursuant to which Tellurian would deliver LNG from its Driftwood LNG production and export terminal to Gunvor. The Driftwood LNG project has a 27.6-Mtpa LNG terminal and feed the gas pipeline of 154.5 kilometers. The project is expected to be online in the year 2023.
Financial View of Tellurian Stock
In the first quarter of 2021 financial results, TELL stock reported revenue of $8.7 million generated from the sales of natural gas. The net loss for TELL stock was roughly $27 million, or $0.08 per share (basic and diluted) in the first three months of 2021.
At the end of the first quarter of 2021, TELL stock had cash and cash equivalents of $58.7 million as compared to cash and cash equivalents of $78.3 million by the end of December 2020. $270.3 million for total assets was reported at the end of the first quarter.
Production in First Quarter of 2021
3.3 billion cubic feet of natural gas have been produced in the first three months of 2021 which is 0.6 billion cubic feet lesser than the previous quarter. As of March 31, 2021, TELL stock had 9,704 net acres and 72 producing wells.
Investors are responding to the recent long-term agreement announcement between TELL stock and Vitol Inc. The recent events show that Tellurian stock is growing its business with time. Hence investors should keep an eye on it.