Kosmos Energy to capitalise on soaring gas demand
US-based Kosmos Energy said November 8 the cash generated from assets in Ghana acquired recently from Occidental Petroleum could help it focus its strategy in LNG.
Kosmos joined Ghana National Petroleum Corp. in October in offering a collective $750mn to acquire Occidental’s stake in the Jubilee and TEN fields off the coast of West Africa. Kosmos already has a 24% position at Jubilee and 17% at TEN. The deal will expand its interests in Jubilee and TEN to 42% and 28%, respectively.
“The Oxy-Ghana transaction accelerates our strategic delivery with increased near-term production and cash flow driving down leverage,” Andrew G. Inglis, the CEO at Kosmos, said. “The cash flow from the acquired assets also supports our portfolio transition to LNG at a time of increasing global gas demand.”
Global gas demand is accelerating as the world moves further away from the pre-vaccine stage of the COVID-19 pandemic. An early-year report from consulting firm McKinsey and Co. estimates the share of LNG in the global gas supply will increase from the current level of 13% to 23% by 2050.
Texas-based Kosmos is also part of a BP-led consortium developing the Greater Tortue Ahmeyim (GTA) complex off Mauritania and Senegal.
The first phase of the project was sanctioned in late 2018, with a liquefaction capacity of 2.5mn metric tons/year. Production was originally due to start in 2020, but the launch was pushed back to 2023 because of the coronavirus pandemic.
Inglis said the company now has a “clear funding path” that will lead the way to first gas at GTA, but offered no guidance on a deadline.
Kosmos posted $198mn in oil and gas revenue for the three-month period ending September 30, an 11% decline from the same period in 2020. Total revenue of $200mn for the third quarter compared with the $224mn realised during Q3 2020.