Kosmos reports Q4 net loss of $16m as capex narrows

(Sharecast News) - Kosmos Energy reported a net fourth-quarter loss of $7m on Monday, or one cent per diluted share, and an adjusted net loss of $16m, or three cents per share. The company recorded revenue of $398m at $65.80 per barrel of oil equivalent for the period, while production expenses reached $153m, excluding $35.6m associated with the Greater Tortue Ahmeyim LNG project.

Capital expenditures for the quarter totaled $117m, slightly exceeding guidance due to higher startup costs at GTA.

Operational performance was supported by total net production averaging about 66,800 barrels of oil equivalent per day, with sales around 65,700 barrels per day.

Kosmos achieved significant milestones during the quarter, including first gas production at the GTA LNG project in December and first LNG production in February.

The firm also secured the Noble Venturer drilling rig for its 2025-2026 Jubilee drilling campaign and initiated a 4D seismic survey over the Jubilee and TEN fields.

Additionally, Kosmos reported zero lost-time injuries or total recordable injuries for 2024.

On the balance sheet, the company ended the quarter with about $2.8bn of total long-term debt and about $2.7bn in net debt, supported by available liquidity of roughly $535m.

Kosmos generated $176m in net cash from operating activities and reported free cash flow of around $14m.

Looking ahead, the company said it expected 2025 capital expenditures to be at or below $400 million - more than 50% lower than the previous year - and was targeting an annual overhead reduction of approximately $25 million by year-end 2025.

In its reserves update, Kosmos reported year-end 2P reserves of roughly 528 million to 530 million barrels of oil equivalent, reflecting a reserve replacement ratio of 137% and a reserves-to-production ratio of about 22 years.

Upward revisions in Mauritania and Senegal were key contributors to the figures, although the results do not include any recognition for the Tiberius and Yakaar-Teranga discoveries.

"In 2022, we set out a goal to materially grow production from several key projects across our portfolio," said chairman and chief executive officer Andrew Inglis.

"2024 was a year of delivering those projects, with continued 2P reserve growth and production now increasing as the projects ramp up.

"With the end of this highly capital-intensive period for the company we will now prioritise the generation of free cash flow from our increased production base together with disciplined capital investment."

Inglis noted that the company's forecast 2025 capex budget of $400m was a reduction of over 50% from recent years.

"Operationally, we were pleased to see first gas production at GTA at the end of 2024, followed earlier this month by first LNG production, two significant milestones for the project, its partners and the people of Mauritania and Senegal.

"The first cargo is currently being prepared for loading. GTA is a world-scale asset in the Kosmos portfolio and with the initial capital intensive phase complete, we can focus on delivering the full potential of the asset with significant room to grow production and cash flow."

Inglis noted that in the Gulf of Mexico, the company expected production to further increase from the Winterfell 3 & 4 wells in the coming months, adding that it had been pleased by the production optimisation projects undertaken during 2024.

"In Ghana, with the Jubilee 4D seismic and the upcoming infill drilling program, we expect to see production increasing.

"Jubilee is a world-class oil field and with the appropriate field management, sustained water injection and high facility reliability, the asset is capable of delivering strong production volumes for many years to come."

Reporting by Josh White for Sharecast.com.