Kosmos Loss Deepens, Shell Inks Alliance

US independent Kosmos Energy’s net 3Q loss doubled but last month it signed a new exploration alliance with Shell.

Kosmos reported November 5 a net 3Q loss of $126.1mn, double its 3Q 2017 loss of $63.4mn, taking its nine-month 2018 loss to $279.6mn. The company said its adjusted net loss for 3Q 2018 was $91.5mn. 

Net production sold was 51,860 barrels of oil equivalent/day, up 62% year on year from Ghana and Equatorial Guinea. CEO Andrew Inglis said that Kosmos would pay its “inaugural dividend payment in 1Q 2019” as it expects near-term cash-flow growth. The TEN floating production ship (FPSO) may surpass its 80,000 b/d (gross) nameplate capacity in 2019 as more wells come on stream. Kosmos' target is to achieve gross production from Jubilee and TEN (both offshore Ghana) of 180,000 to 200,000 b/d over the next three years, not including associated gas – now being produced from both fields. 

Offshore Mauritania and Senegal, Kosmos said its partnership with BP remains “on track for phase 1 final investment decision around year-end 2018” on their Tortue floating LNG project and is “progressing the LNG offtake agreement”; last week BP said Tortue was on target for a 2018 FID.

Finally, Kosmos said in October 2018 it entered into a “strategic exploration alliance with Shell to jointly explore in southern west Africa” – initially in Namibia, where Kosmos has completed a farm-in to Shell's acreage in PEL 39, and Sao Tome & Principe where Kosmos have entered into exclusive negotiations for Shell to take an interest in Kosmos’ acreage in Blocks 5, 6, 11, and 12. The two firms though will also  "jointly evaluate opportunities in adjacent geographies."  Kosmos already has a similar partnership with BP relating to Mauritania, Senegal and The Gambia.