Tellurian slashes net loss in Q3

US LNG export project developer Tellurian reported a lower net loss in the third quarter, while it also started production from two new natural gas wells.

Tellurian posted a net loss of about $18.7 million, compared to a loss of $29.4 million in the July-September period last year.

The developer of the 27.6 mtpa Driftwood project ended its third quarter with about $210.8 million of cash and cash equivalents and no borrowing obligations.

Natural gas sales for the third quarter generated about $15.6 million in revenues compared to $7.3 million during the same period of 2020.

During the quarter, the firm signed a long-term LNG sales deal with Shell and raised about $116 million in a public stock offering.

The Houston-based firm has this year signed three 10-year LNG supply deals for its Driftwood project in Louisiana for a total of 9 million tonnes per year. These include contracts with Gunvor and Vitol.

Tellurian said it has sold all the necessary offtake for the first phase of the Driftwood LNG plant which would include two units with a capacity of about 11 mtpa. Total development costs for this phase would reach about $11.9 billion.

Chief executive Octavio Simoes said Tellurian recently brought production online from
two newly completed natural gas wells, “adding to our financial strength and integrated model that provides a valuable hedge to volatile global prices.”

“By year end 2021 we plan to produce approximately 70 million cubic feet equivalent per day (mmcfed),” he said.

In addition, Tellurian has authorized a new drilling program and plans to drill 12 – 14 wells to produce approximately 220 mmcfed by year end 2022.

“We have turned our focus to financing Driftwood LNG and plan to give Bechtel notice to proceed with construction in early 2022,” Simoes said.

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