Mauritania-Senegal floating LNG project gets back on track with work ramp-up for first phase

Tuesday, 02 March 2021
Free Read

Kosmos Energy, the US shareholder in the floating LNG projects offshore the West African nations of Mauritania and Senegal, is aiming for the first phase of the planned floating LNG project to be 80 percent completed by the end of 2021.

Kosmos is developing FLNG production under the Greater Tortue-Ahmeyim project with UK major BP, and in its fourth-quarter earnings report gave an update on the venture.

That’s as the Dallas, Texas-based company generated net income of $8 million and an adjusted net loss of $49M.

The US company specialises in Atlantic Margin assets and also has oil and gas projects operating offshore Ghana and Equatorial Guinea as well as in the Gulf of Mexico.

Kosmos said it expected nine planned infill wells in the Mauritania- Senegal business to provide near-term production growth and a ramp-up in activity on Phase 1 of the Tortue-Ahmeyim project.

Quarterly net production from all the Kosmas operations amounted to 60,200 barrels of oil equivalent per day with sales of 71,200 boepd.

Revenues for the final three months of 2020 came to $274M, or $41.84 per barrel of oil equivalent.

“Phase 1 of the Greater Tortue-Ahmeyim project made good progress in the quarter and was around 50 percent complete by year end,” said Kosmos.

“The project remains on track for first gas in the first half of 2023,” it added.

To fund its current Tortue-Ahmeyim project stake Kosmos has established a financing path to first gas, including the sale of the company's interest in the project’s floating production storage and offloading (FPSO) unit, the re-financing of the National Oil Company loans and a direct investment in Kosmos's Mauritania and Senegal position.

“Good progress has been made with the FPSO sale with Kosmos and BP signing a memorandum of understanding this month outlining the key terms of the transaction,” explained the company.

“Closing is now targeted within the second quarter of 2021. The sale of the FPSO is expected to reduce Kosmos's cash requirements to first gas by approximately $320M,” it added.

Kosmos expects to spend approximately $225M to $275M in 2021, excluding its expenditure on Mauritania and Senegal, and around 80 percent of which will target maintaining and growing existing production and with up to 20 percent targeting growth activities.

“Operational momentum is building in 2021, with a significant uptick in forecast activity across the portfolio,” said Chairman and Chief Executive Andrew G. Inglis.

“We expect the nine planned infill wells in the base business to provide near-term production growth and the ramp up in activity at Phase 1 of Tortue to reach 80 percent completion by year-end,” added Inglis.

“With the strategic actions we took in 2020, we enter 2021 with a lower cost base, a solid balance sheet, healthy liquidity and the operational momentum to deliver value to our shareholders from a portfolio of assets that are low cost and lower carbon,” declared the CEO.

Kosmos said it exited the fourth quarter of 2020 with around $2 billion of net debt and available liquidity of around $570M.

Related Video

Free Read