DALLAS--(BUSINESS WIRE)--Kosmos Energy (“Kosmos”) (NYSE: KOS) announced today its 2013 planned capital program, which totals approximately $525 million. Development activities offshore Ghana comprise approximately 55 percent of the total anticipated amount, with the remaining 45 percent allocated for exploration and appraisal activities across Kosmos’ global exploration portfolio.
In addition, the Company estimates Jubilee field production to average between 105,000 and 115,000 barrels of oil per day in 2013, with the midpoint of the range representing an increase of greater than 50 percent from the 2012 average. Kosmos anticipates a year-end exit rate for 2013 to be above the high end of its annual guidance range. Included in the estimate is a planned two-week shutdown for regular maintenance at the Jubilee floating production, storage, and offloading vessel (FPSO).
Kosmos’ net interest in the estimated 2013 production average is approximately 25,150 barrels of oil per day, at the midpoint of the range. Based on the Company’s crude oil inventory position at the beginning of the year and its expected net portion of 2013 production, Kosmos anticipates selling nine crude oil cargoes during the year. Each crude oil cargo sold represents slightly less than one million barrels of oil and is anticipated to continue trading consistent with Brent crude pricing.
Brian F. Maxted, Chief Executive Officer, stated, “Kosmos’ strategy of organic growth through exploration and development success is highlighted by our 2013 capital program. Our plans for the year include advancing the development of the world-class Jubilee field, as well as further progressing our other discoveries offshore Ghana. Jubilee continues to demonstrate outstanding performance, with current field deliverability substantially above the FPSO capacity. This is a result of resolving the original well productivity issues and completing new Phase 1A wells, which are showing tremendous delivery. Throughout the year, we are challenging the Jubilee teams to identify opportunities to meaningfully enhance throughput of the production facility, allowing us to bring forward substantial value from the field.”
“Elsewhere, we are highly focused on maturing our existing exploration assets to the drilling phase and continuing the build-out of a world-class portfolio of impactful exploration opportunities. Key to our plans for 2013 and beyond is the ability to internally fund our planned investment programs, a result of the successes we have had to date, combined with our disciplined approach to capital spending. We are strongly positioned, both financially and operationally, to continue the momentum we have created and deliver new meaningful value for our shareholders,” Maxted added.
Kosmos’ estimated development program, which totals approximately $290 million, includes funds for further development at Jubilee, with the majority relating to the ongoing implementation of Phase 1A at the field. The Company estimates finalizing the drilling and completion of all Jubilee Phase 1A production and water injection wells by the middle part of the year. Our 2013 capital program also provides funds for the initiation of development at TEN (Tweneboa, Enyenra, and Ntomme), as well as additional appraisal activities and development studies for Mahogany, Teak, and Akasa. The TEN plan of development, which represents Kosmos’ second major project development, has been submitted to the government of Ghana and is awaiting approval.
As part of the Company’s planned exploration and appraisal activities, which total approximately $235 million, Kosmos is participating in two near-term exploration wells. Among these is the Sapele prospect, which is currently drilling on the Deepwater Tano Block offshore Ghana, with results expected by the end of February 2013. In addition, the Company anticipates spudding the Sipo-1 prospect, which is located onshore Cameroon on the Ndian River Block, in early February. Results from Sipo-1 are anticipated around the end of the first quarter 2013.
On the Company’s offshore Morocco licenses, Kosmos’ planned capital program provides for additional geologic studies, as well as further processing and interpreting of 3D data already acquired on the Agadir Basin Blocks. Included in the 2013 capital program are funds for the completion of the Company’s acquisition of an additional 37.5 percent interest in the Essaouira Block, which was previously announced. First drilling offshore Morocco is targeted to commence as early as late 2013.
In Mauritania, Kosmos anticipates commencing a large 2D seismic survey in the first half of the year, to be followed by a 3D seismic program later in 2013. Offshore Suriname, the Company anticipates additional spending related to the processing and interpreting of a 3D seismic survey which was acquired in late 2012.
Also included in the anticipated exploration program for 2013 is an amount for new business opportunities, with the majority allocated for seismic expenditures in the current year.
One of the Company’s strategic goals in 2013 is to secure important co-venturer arrangements in several of its exploration areas. The announced 2013 capital program excludes the impacts of any completed farm-outs during the year.
About Kosmos Energy
Kosmos Energy is a leading independent oil and gas exploration and production company focused on frontier and emerging areas in Africa and South America. The Company’s asset portfolio includes existing production and other major project developments offshore Ghana, as well as exploration licenses with significant hydrocarbon potential offshore Mauritania, Morocco and Suriname and onshore Cameroon. Kosmos is listed on the New York Stock Exchange and is traded under the ticker symbol KOS. For additional information, visit www.kosmosenergy.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that Kosmos expects, believes or anticipates will or may occur in the future are forward-looking statements. Kosmos’ estimates and forward-looking statements are mainly based on its current expectations and estimates of future events and trends, which affect or may affect its businesses and operations. Although Kosmos believes that these estimates and forward-looking statements are based upon reasonable assumptions, they are subject to several risks and uncertainties and are made in light of information currently available to Kosmos. When used in this press release, the words “anticipate,” “believe,” “intend,” “expect,” “plan,” “will” or other similar words are intended to identify forward-looking statements. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of Kosmos, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. Further information on such assumptions, risks and uncertainties is available in Kosmos’ Securities and Exchange Commission (“SEC”) filings. Kosmos undertakes no obligation and does not intend to update or correct these forward-looking statements to reflect events or circumstances occurring after the date of this press release, except as required by applicable law. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement.