Petroleum Africa
Find us on: 
Tuesday, May 12, 2020
Kosmos Energy announced its financial and operating results for the first quarter of 2020. For the quarter, the company generated a net loss of $183 million, or $0.45 per diluted share. When adjusted for certain items that impact the comparability of results, the company generated an adjusted net loss of $66 million or $0.16 per diluted share for the first quarter of 2020.
FIRST QUARTER 2020 HIGHLIGHTS
In addition to the timing mismatch between production and the lifting of cargos, the first quarter was impacted by non-cash asset impairments and restructuring charges of $169 million. These charges were partly reduced by a mark-to-market gain of $136 million, offset by a $12 million cash settlement related to the Company’s oil derivative contracts. The company also incurred non-cash deferred tax expense related to a valuation allowance against deferred tax assets and the increased market value of the hedges, totaling $72 million.
As of the quarter end and including recently executed hedges, Kosmos has approximately 20.2 million barrels of oil hedged covering 2020 and 2021 including Brent and LLS based hedges. The company’s oil hedge position was restructured in early April to provide further downside protection to lower oil prices through 2020.
Kosmos exited the first quarter of 2020 with approx. $677 million of liquidity and $1.97 billion of net debt. In accordance with our normal banking requirements, in early April Kosmos successfully completed the re-determination of its reserve-based lending facility, voluntarily reducing its facility commitments from $1.6 billion to $1.5 billion. The reduction in facility size and borrowing base, reduced liquidity in early April by $100 million.
Commenting on the company’s Q1 2020 performance and the current COVID-19 situation, Chairman and Chief Executive Officer Andrew G. Inglis said: “COVID-19 has created unprecedented disruption across the world, which has resulted in historically low and volatile prices. During this challenging period, the health and safety of our employees and contractors continues to be our primary concern, while ensuring the strength of our balance sheet is maintained.:
“Kosmos’ operations performed well during the first quarter with production across our three hubs in line or at the top end of expectations. Our differentiated portfolio of low-cost, low decline conventional assets is well positioned to withstand the lower price environment we are in today.
“In response to the volatile market conditions, we have taken decisive actions to protect the business in 2020 and position it for increased activity in 2021. These measures include materially reducing costs and restructuring our hedging portfolio. We completed our RBL re-determination in difficult market conditions in April and have no near-term debt maturities.
“We look forward to building a self-funded gas business in Mauritania and Senegal and progressing our high-quality portfolio of ILX and basin-opening exploration prospects for 2021.”
" alt="First LNG Realized at the Greater Tortue Ahmeyim Project">
" alt="United Energy Acquires Western Desert Producer APEX">
" alt="Baker Hughes Announces Major Gas Technology Orders for Venture Global LNG">
" alt="ReconAfrica: Naingopo Results Demonstrate a Working Petroleum System">
" alt="Tullow Highlights 2025 Operational Plans in Ghana">
" alt="TotalEnergies to Supply 1.5 TWh to STMicroelectronics in France Over 15 years">
" alt="Rockhopper Reaches Final Settlement with United on Egypt’s Abu Sennan Concession">
" alt="Oil & Gas Crucial for African Growth: AEC Calls for Industry Support to Defend African Market">
