Kosmos Energy Ltd - Operational Update
KOSMOS ENERGY OPERATIONAL UPDATE
"In Mauritania and
"Kosmos has an active second half of the year with planned infill wells in all three hubs supporting our near-term production growth. We also expect to restart exploration and appraisal drilling in the
With rising oil prices and a robust financial position, we are well placed to create shareholder value through the rest of 2021." 1
Sales volumes in the second quarter averaged around 66,000 barrels of oil equivalent per day (boepd) with 4.5 cargos lifted, in line with guidance.
Total net production in the second quarter averaged approximately 52,000 boepd, slightly below prior guidance primarily due to lower production in
Full year company production guidance of 53,000-57,000 boepd is unchanged with a year-end exit rate of approximately 60,000 boepd expected as new wells come online.
The first two wells in our four-well campaign have been drilled and the rig has now begun completion operations. The first Jubilee producer well (J-56P) is expected online shortly and the Jubilee injector well (J-55W) is expected online later in the third quarter. These wells are expected to add gross production of around 15,000-20,000 bopd. The rig is then scheduled to drill and complete a TEN gas injector well and a second Jubilee producer well later in the year with the Jubilee producer well expected online around the end of the year.
The reliability of the
Consistently high levels of water injection (>200,000 barrels/day) and gas offtake from the
Earlier in the year, Kosmos and its partners made the Winterfell discovery in the
Kosmos also plans to drill the Zora infrastructure-led exploration (ILX) well early in the third quarter and a rig has been contracted for this activity.
The Greater Tortue Ahmeyim ("GTA") liquified natural gas (LNG) project has made steady progress year-to-date with the following milestones achieved in the second quarter:
· Floating LNG vessel: The four remaining sponsons have been integrated in the final dry dock
· FPSO: The living quarters have been installed
· Breakwater: Five caissons have now been transported offshore with the first caisson installed
Project partners have received a revised forecast from the EPCIC contractor, TechnipFMC, that the delivery of the FPSO is likely to be slightly delayed due to labor shortages at the COSCO yard in
BP, as operator of the GTA project, has informed partners that due to the impacts of COVID-19 (including the FPSO delay), cost inflation and scope growth, Phase 1 project costs are expected to increase. On the basis of the revised schedule, Kosmos currently expects the gross cost for the project to be approximately 15% higher, resulting in an estimated increase of Phase 1 costs to first gas net to Kosmos of around
The FPSO sale and lease back transaction is now expected to close this quarter upon the finalization of the documentation between the governments and partners. Following the closing of the FPSO sale and lease back transaction, the company will work to complete the re-financing of the
In addition, partners continue to make progress on Phase 2 of the GTA LNG project and we are targeting a final investment decision in late 2022 as previously communicated.
Following the completion of the
The Company is currently around 60% hedged for the remainder of 2021 with growing exposure to higher oil prices as hedges roll off. We have taken advantage of rising oil prices to hedge 4.5 million barrels of 2022 production.
1. The Company defines net debt as the sum of notes outstanding issued at par and borrowings on the RBL Facility and Corporate revolver less cash and cash equivalents and restricted cash.
Kosmos is a full-cycle deepwater independent oil and gas exploration and production company focused along the Atlantic Margins. Our key assets include production offshore
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that Kosmos expects, believes or anticipates will or may occur in the future are forward-looking statements. Kosmos' estimates and forward-looking statements are mainly based on its current expectations and estimates of future events and trends, which affect or may affect its businesses and operations. Although Kosmos believes that these estimates and forward-looking statements are based upon reasonable assumptions, they are subject to several risks and uncertainties and are made in light of information currently available to Kosmos. When used in this press release, the words "anticipate," "believe," "intend," "expect," "plan," "will" or other similar words are intended to identify forward-looking statements. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of Kosmos, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. Further information on such assumptions, risks and uncertainties is available in Kosmos' Securities and Exchange Commission ("
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