LNG

Kosmos Energy expects material growth in 2026 from expanded gas production both in Ghana and at the Greater Tortue Ahmeyim (GTA) floating LNG project offshore Mauritania and Senegal.

Mauritania will launch a bidding process in two weeks’ time for a 550 MW gas-fuelled power plant linked to the Greater Tortue Ahmeyim (GTA) liquefied natural gas project. The new power project will be developed and financed through a public-private partnership (PPP).

Despite holding almost 9 percent of the world’s proven reserves of natural gas, Africa remains the most energy-poor continent while industries rely on expensive, inefficient and polluting sources of energy leaving hundreds of millions of households lacking modern energy access, according to a new International Gas Union report.

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.

Kosmos Energy, a stakeholder in several floating liquefied natural gas projects offshore West Africa, said that the latest drilling in the offshore Yakaar-Teranga field encountered world-scale resources with the potential to support another LNG project.

Kosmos Energy, the US partner of BP in the Mauritania-Senegal floating LNG projects, has completed its acquisition for more than $1.22 billion of Deep Gulf Energy as it keeps faith in the deepwater Gulf of Mexico as other operators retreat to the US onshore shale basins.

Kosmos, based in Dallas, said it purchased Deep Gulf Energy to expand its assets in the Atlantic Margin exploration area of the most distant parts of the Gulf that can have similar deepwater challenges to offshore West Africa.

“By acquiring DGE, Kosmos adds to its deepwater Atlantic Margin portfolio an established business with attractive assets and a strong record of growing production and reserves through infrastructure-led exploration,” said Kosmos.

“This immediately accretive acquisition enhances the scale of the company and is expected to generate significant free cash flow,” added Kosmos.

Houston, Texas-based DGE was founded in 2005. The company has drilled 20 wells, 16 of which have been completed. The company achieved its first production in 2007 and the acquisition would add around 25,000 barrels of oil equivalent per day of production for Kosmos.

Kosmos notes that while many competitors have been leaving the Gulf of Mexico to pursue onshore shale plays, their departures have created an opportunity to further open up the Gulf.

“The best deepwater assets can compete with the best of shale, and now is a good time to enter the Gulf of Mexico,” said Kosmos.

The completion of the DGE deal comes as Kosmos and BP are moving forward with contract awards for the Tortue-Ahmeyim natural gas project in the Atlantic Margin of Mauritania and Senegal that will underpin several FLNG ventures.

The Tortue-Ahmeyim project will produce gas from a deepwater subsea system and transfer it to an FLNG production facility at a nearshore hub located on the Mauritania and Senegal maritime border.

The FLNG facility for Phase 1 is expected to deliver about 2.5 million tonnes per annum of LNG on average.

The full project will target 10 MTPA of LNG output as well as making gas available for domestic use in both Mauritania and Senegal.

First gas from the African project is expected in the first half of 2022.

Kosmos Energy, a main partner in the BP-led floating liquefied natural gas projects offshore Senegal and Mauritania in West Africa, has announced key management changes as its FLNG proposals move forward.

BP of the UK and Kosmos Energy of the US have decided to go ahead with their multi-billion dollars of investments in developing floating liquefied natural gas projects offshore West Africa with their state partners Mauritania and Senegal.

French energy major Total and the West African state of Mauritania have signed an agreement on two new exploration and production contracts near an area where natural gas has been discovered and is underpinning two floating LNG projects also involving Senegal.

Kosmos Energy, the partner of BP in two floating LNG projects offshore Senegal and Mauritania, said the front-end engineering and design for phase one was almost completed and the development plan had been submitted to both governments.