24th Feb 2025 09:49
(Alliance News) - Kosmos Energy Ltd on Monday said it plans to lower capital expenditure and overheads as it reported a slump in profitability.
The Africa-focused gas and oil exploration company reported a net loss of USD6.6 million in the three months to December 31 compared with net income of USD21.7 million a year prior. Revenue fell 22% to USD397.7 million from USD507.8 million.
For 2024 as a whole, net income fell 11% to USD189.9 million from USD213.5 million on revenue of USD1.68 billion, down 1.2% from USD1.70 billion.
Total production in the quarter averaged 66,800 barrels of oil equivalent per day, up slightly from 66,000 boepd a year prior. In 2025, Kosmos expects production between 70,000 to 80,000 boepd, with 62,000 to 66,000 boepd in the first quarter.
Kosmos said first quarter production will be impacted by planned shut-downs at Jubilee in Ghana and at the Devils Tower facility, which hosts Kodiak field, in the Gulf of Mexico.
Capital expenditure for the quarter was USD117 million, higher than USD100 million guidance, primarily due to higher startup costs associated with GTA. In 2025 capital expenditure is expected to be USD400 million or below, more than 50% lower than 2024, the firm added.
The firm is also targetting a reduction in annual overhead of around USD25 million by year-end 2025.
Chair and Chief Executive Andrew Inglis said: "In 2022, we set out a goal to materially grow production from several key projects across our portfolio. 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 prioritize the generation of free cash flow from our increased production base together with disciplined capital investment."
Inglis said production in the Gulf of Mexico is expected to further increase from the Winterfell 3&4 wells in the coming months and in Ghana, at the Jubilee field.
"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," he added.
Shares in Kosmos Energy fell 2.2% at 262.00 pence each in London on Monday morning.
By Jeremy Cutler, Alliance News reporter
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