Earning Date, Transcript Summary & Report

Diverse Energy Portfolio: Kosmos Energy Ltd. has a unique portfolio with a diverse set of world-scale oil and gas assets, characterized by low operating costs and high cash margins.

Reserve Replacement Success: The company achieved a 2P reserve replacement ratio of 137% in 2024, indicating strong reserve growth and longevity of the asset base.

Capital Expenditures Decline: Total capital expenditures (CapEx) are expected to fall significantly from over $800 million in 2023 and 2024 to $400 million in 2025, a reduction of over 50%.

Production Growth Expectations: Kosmos Energy Ltd. achieved first oil at Wintervale in the summer of 2024 and expects production to rise with new wells coming online.

Bond Issuance and Debt Management: The company raised $900 million in new bonds at competitive rates, enhancing its financial position and extending debt maturities.

Debt Management Strategy: Kosmos Energy Ltd. has successfully managed its debt, with minimal near-term maturities and a rolling hedging program that protects cash flow against price volatility.

First LNG Production Milestone: The GTA project achieved first LNG production in early February 2025, marking a significant milestone for the company and the establishment of a new Atlantic basin LNG hub.

Cash Generation Strategy: The company is focused on cash generation, with plans to prioritize debt pay down and shareholder returns as production increases and costs decrease.

Lower Production Guidance: Production for the fourth quarter was lower than guidance, partly due to lower Jubilee production flagged by the operator.

Power Generation Reliability Issues: There were reliability issues related to power generation affecting water injection at Jubilee, leading to insufficient voidage replacement.

Production Ramp-Up Delay: The production ramp-up from the EG infill wells was delayed, impacting overall production figures for the quarter.

Production Stability Outlook: The company expects production to be broadly flat quarter on quarter due to planned maintenance programs in the current quarter.

Production Challenges in Ghana: Despite a strong reserve replacement ratio of 137%, the company faced challenges in production targets, particularly in Ghana.

Production Underperformance Issues: The J-sixty nine well and Jubilee underperformed, contributing to lower net production than anticipated.

Field Management Challenges: The company is still addressing field management issues, which have affected production reliability.

Oil Zone Encountered, Abandoned: The King D Violex well encountered oil zones but was deemed sub-commercial, leading to its plugging and abandonment.

Cash Generation Focus: The company is focusing on cash generation but has acknowledged the need for further improvements in production reliability and efficiency.