Kosmos Energy, the Dallas-based exploration and production company, posted a net fourth-quarter loss as it continued to make progress on the floating LNG export projects being developed with BP of the UK offshore Mauritania and Senegal in West Africa.
“The Greater Tortue Ahmeyim project located offshore Mauritania and Senegal remains on track with Phase 1 approximately 25 percent complete,” stated Kosmos.
“Pre-FEED work is ongoing for Phases 2 and 3 and these phases are expected to expand capacity to almost 10 MTPA of LNG export capacity,” added the US company.
Kosmos said that for the final three months of 2019 its losses came to $35.7 million compared with a profit of $185.5M in the same three months of 2018.
Oil and gas revenues in the quarter came to $450M versus $301M in the 2018 quarter.
Annual oil and gas revenues amounted to $1.49 billion compared with $886.6M in 2018.
Kosmos said one highlight happened after the fourth quarter with the signing on the 11th of February 2020 with its partners, the state energy companies of Senegal and Mauritania, of a Sale and Purchase Agreement (SPA) with BP Gas Marketing for 2.45 million tonnes per annum of LNG from Phase 1 of the project for an initial term of up to 20 years.
“Signing the SPA has allowed Kosmos to book approximately 100 million barres of oil equivalent of proven reserves associated with the project,” said the US company, listed on the New York Stock Exchange.
Kosmos announced during the fourth quarter that the Orca-1 exploration well made a major gas discovery offshore Mauritania in the Bir Allah area.
The company noted that Orca was the largest deepwater hydrocarbon discovery in 2019 and the results continue the 100 percent success rate from nine wells targeting the inboard gas trend in Mauritania and Senegal.
“It was a strong year for Kosmos with the business generating approximately $250 million of free cash flow, the third successive year of material organic cash generation,” said Chief Executive Andrew G. Inglis.
“It was also one of the most active years in the company’s history with over 1.7 million man hours operating five wells,” added the CEO.
“Our exploration and appraisal program delivered five successes from seven wells drilled and we continue to make excellent progress with our developments in Mauritania and Senegal with Tortue Phase 1,” stated Inglis.
Kosmos has other oil and gas operations offshore the US Gulf of Mexico, as well as Ghana and Equatorial Guinea in West Africa.
Excluding Mauritania and Senegal, the company said it expected to spend around $325M to $375M in 2020.
In Mauritania and Senegal, total 2020 capital expenditure for Kosmos will be about 30 percent working interest, or around $250M, and is expected to be funded from proceeds from the previously announced and ongoing farm-down process, whereby a stake is being sold by Kosmos.