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Kosmos Energy's TEN Project Set to Deliver in 2016

Share Print Bookmark    |    Thursday,August 06,2015

Kosmos Energy Ltd. has announced financial and operating results for the second quarter of 2015.

Highlights for the quarter ended June 30, 2015:

• Made a significant, basin-opening gas discovery offshore Mauritania
• Sold 1.9 million barrels of oil, net to Kosmos
• Completed approximately 65 percent of the development of the TEN project
• Improved liquidity through add-on offering of senior notes, and refinancing of our corporate revolving credit facility
• The second quarter results included a mark-to-market loss of $44.9 million related to the Company’s oil derivative contracts. The Company’s hedging position as of June 30, 2015, was 11.1 million barrels through 2017.
• Total capital expenditures in the second quarter were $149.7 million. This amount is net of the $28.7 million of proceeds collected by Kosmos during the second quarter associated with the previously announced farm-out of a 30% interest in our Mauritania licenses to a wholly owned subsidiary of Chevron Corporation.
• Kosmos exited the second quarter of 2015 with $1.9 billion of liquidity, consisting of cash on hand and availability under our debt facilities, and $530.8 million of net debt compared to $1.7 billion of liquidity and $407.4 million of net debt as of March 31, 2015.

Operational Update

In April, the Company announced that the Tortue-1 exploration well made a significant, play-opening gas discovery offshore Mauritania. The Company encountered 107 meters (351 feet) of net pay in the Cenomanian, which was the primary objective. Subsequently, Tortue-1 intersected an additional 10 meters (32 feet) of gas in the lower Albian section. An appraisal program is being planned to delineate the Ahmeyim discovery, previously referred to as Tortue. In addition, the Marsouin-1 exploration well, located in the central part of Block C-8 in Mauritania, is expected to spud in the third quarter of 2015.

Gross production from the Jubilee field was strong during the quarter, averaging sales of approximately 108,000 barrels of oil per day (bopd). Gas exports continued to operate reliably, exporting between 70 and 80 million cubic feet per day (MMcfpd). In July, a gas compressor on the floating production, storage and offloading vessel (FPSO) ceased operations, which limited our ability to export or inject gas. Repair of the compressor is underway and we expect to resume full production shortly. Gross Jubilee production guidance for 2015 remains unchanged at approximately 100,000 bopd sales and eight cargoes, net to Kosmos. The Company also remains on track to submit a full-field development plan before the end of the year for the development of all future phases of the Jubilee field, as well as the Mahogany, Teak and Akasa discoveries.

The Tweneboa, Enyenra and Ntomme (TEN) project, the second major oil development project in Ghana, remains on-budget and on-track to deliver first oil in the third quarter of 2016. The project is now approximately 65 percent complete.



Andrew G. Inglis, chairman and chief executive officer said: "Kosmos continued to build momentum in the second quarter.  Our Tortue-1 gas discovery offshore Mauritania is the industry’s largest offshore find so far this year. The Jubilee field delivered growing production averaging approximately 108,000 barrels of oil per day gross (sales). The TEN project is now approximately 65 percent complete and remains on schedule to produce first oil in the third quarter of 2016. With our strong balance sheet, we remain focused on executing our plans with discipline and maximizing shareholder value."