29th Jun 2020 10:27
(Alliance News) - Oil & gas firm Kosmos Energy Ltd said Monday it has entered a crude oil prepayment agreement with physical commodity trading group Trafigura Trading LLC.
The agreement will provide up to USD200 million of crude oil sales mainly related to a portion of Kosmos's 2022 and 2023 production from the Gulf of Mexico, with USD150 million committed by Trafigura.
Texas-based Kosmos said it intends to execute USD50 million of advance crude oil sales in June. Later in 2020, following the completion of the agreement's conditions, an additional USD100 million to USD150 million of advance crude oil sales is expected, subject to finalising additional commitments for USD50 million.
"At the start of the market downturn, Kosmos took decisive action to reduce costs, restructure hedges, and preserve liquidity. With this prepayment agreement, we have secured up to USD200 million in additional liquidity to help us manage the business during this time of unprecedented volatility. This liquidity also gives us the flexibility to take advantage of opportunities that may arise in a dislocated market," said Chief Financial Officer Neal Shah.
Shares in Kosmos Energy were up 5.0% at 157.42 pence on Monday in London.
By Dayo Laniyan; [email protected]
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