Kosmos Energy Ltd. Q2 FY2025 earnings call

• Priorities: Key priorities include growing production, reducing costs, and strengthening the balance sheet. - Production Progress: The GTA floating LNG vessel achieved Commercial Operations Date, with production ramping towards nameplate capacity. Drilling and production have restarted at Jubilee, and the Winterfell-4 well was drilled. - Cost Reduction: CapEx was reduced from ~$400 million to ~$350 million. OpEx per BOE is falling on GTA, and $25 million of overhead savings are on track to be delivered by the end of 2025. - Balance Sheet: Agreed indicative terms for a $250 million term loan secured against Gulf of America assets. 7 million barrels of 2026 oil production are hedged, and a waiver from banks on the debt cover ratio covenant was granted until March 2026.

GTA Project (Senegal and Mauritania): Second quarter net production was just over 7,000 barrels of oil equivalent per day. Year-to-date, 6.5 gross LNG cargoes have been lifted. Production is expected to rise towards the nameplate capacity of 2.7 million tonnes per annum in the fourth quarter. Ghana (Jubilee and TEN): Total net production was around 29,100 barrels of oil equivalent per day. Jubilee gross production was lower than expected in the second quarter due to shutdowns and well issues. TEN gross oil production in the quarter was just under 16,000 barrels of oil per day. Gulf of America: Net production was around 19,600 barrels of oil equivalent per day at the upper end of guidance, driven by strong output from the Odd Job and Kodiak fields. The Winterfell-4 well was drilled in the second quarter and is anticipated to come online late in the third quarter. Equatorial Guinea: Net production was just under 8,000 barrels of oil per day, lower than expectations due to subsea pump mechanical failures at Ceiba.

• Full-year CapEx forecast reduced from ~$400 million to ~$350 million. - Production is expected to continue rising into 2026 with GTA ramping, Jubilee wells, and Winterfell coming online. - Aim to hedge around 50% of 2026 production by the end of 2025.

• Commodity price volatility. - Uncertainty in drilling program outcomes and reservoir performance at Jubilee. - Delays in refinancing or operating model optimizations at the GTA project.

Q: Charles Meade on Jubilee decline and GTA cost reduction.

A: Andrew Inglis discussed data improvements, drilling to offset decline at Jubilee, and cost optimization efforts at GTA including refinancing and exploring lower-cost operating models.

Q: Matt Smith on CapEx and GTA Phase 1 plus.

A: Andrew Inglis talked about CapEx prioritization and progress on GTA Phase 1 plus, including alignment around the project and potential for incremental volume growth.

Q: Bob Brackett on Jubilee decline and license extension.

A: Andrew Inglis explained decline rates at Jubilee and details of the license extension MOU, including gas volume commitments and well drilling undertakings.

Q: Alexa Petrick on GTA costs and free cash flow.

A: Neal Shah discussed GTA cost components (FLNG toll, FPSO lease, field OpEx) and expectations for normalized free cash flow around $50-$55 per barrel.

Q: Mark Wilson on GTA gas sales and Jubilee operator.

A: Andrew Inglis talked about gas sales considerations for GTA Phase 1 plus and alignment between Kosmos and Tullow in operating Jubilee.

Q: Stella Cridge on debt financing.

A: Neal Shah discussed debt financing options, including a $250 million term loan and plans to address longer-dated maturities, and RBL coverage based on cash flow and oil prices.

Q: Bob Brackett on GTA domestic gas.

A: Andrew Inglis mentioned pipeline gas as the envisioned solution for domestic gas utilization at GTA