Kosmos Energy Ltd. · NYSE:KOS
Kosmos Energy — Q4 2020 Earnings Presentation
21 slides from Kosmos Energy's earnings presentation, Feb 22, 2021
Slide 1: 4Q 2020 Results
4Q 2020 Results February 22 2021 NYSE/LSE: KOS 0 Strictly Private and Confidential
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements This presentation 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 presentation
Slide 3: A Portfolio to Deliver FCF and Shareholder Value
A Portfolio to Deliver FCF and Shareholder Value High quality conventional portfolio with strong ESG credentials World Class Returns Focused Conventional Assets Exploration Portfolio • Atlantic Margin, conventional deepwater strategy • Proven basins with Kosmos deep technical capability • Diverse pr
Slide 4: 2020: We Advanced our Strategy in a Challenging Environment
2020: We Advanced our Strategy in a Challenging Environment Strong delivery on our strategic priorities World Class • Production of ~61,000 boepd • Tortue Phase 1: ~50% complete at YE20 Conventional • Published TCFD-aligned Climate Risk and Resilience Report and Sustainability Report Assets • Set go
Slide 5: Significant Reserves Base
Significant Reserves Base 2P reserves-to-production life of over 20 years • Robust 2P reserves of ~480mmboe Kosmos 2P Reserves (Mmboe) ⎯ 2P reserves-to-production of >20 years 141.6 ⎯ 2020 changes largely reflect optimized Ghana Tortue development and 2020 production Gulf of Mexico 233 Equatorial Gu
Slide 6: Safety Is Our Most Important Priority
Safety Is Our Most Important Priority One Team, One Goal initiative unites Kosmos employees, contractors and host countries in delivering HSE excellence Lost Time Injury Rate 2016-20201 COVID-19 Response & Hunger Relief 0.40 0.25 Medical equipment, test kits and other supplies including masks and gl
Slide 7: 4Q 2020: Operational Performance
4Q 2020: Operational Performance Improving reliability and resuming production-adding activity creates momentum into 2021 Ghana Equatorial Gulf of Mexico Mauritania / Guinea Senegal • 4Q net production of • 4Q net production of • 4Q net production of • Strong progress in 4Q ~24,300 bopd ~10,500 bopd
Slide 8: 2020: Financial Progress
2020: Financial Progress Decisive action taken in early 2020 has delivered sustainable cost reductions and materially lower corporate cash breakeven Operating Expenses ($million) Cash G&A ($million) - 16% - 49% Exploration Expense ($million) Base Business Capital Expenditure1 ($million) 200 500 400
Slide 9: 4Q 2020: Financial Performance
4Q 2020: Financial Performance Significant progress in the quarter 4Q 2019A 4Q 2020A YoY Change Net Production1 ~65,200 boe/day ~60,200 boe/day -8% Realized Price2 ~$58.52/boe ~$37.95/boe -35% Opex ~$18.12/boe ~$15.85/boe -13% DD&A ~$19.63/boe ~$24.34/boe 24% G&A3 $21 million $15 million -29% Explor
Slide 10: 2020: Balance Sheet Remains Solid
2020: Balance Sheet Remains Solid Maintained healthy liquidity levels throughout 2020 Closed Shell transaction in 4Q20 Liquidity ($ million)1 • ~$95 million proceeds received in December 700 • A further $100 million potential upside on success 600 FY20 base business capex of $147 million • In line w
Slide 11: 2021: Rebuilding Operational Momentum
2021: Rebuilding Operational Momentum Momentum accelerating in 2021 2020 2021 Base Business 3 infill 9 infill wells drilled wells planned Phase 1: Expected Tortue LNG Project ~50% complete ~80% complete at YE at YE Proven Basin 2-3 wells planned Exploration 1 well drilled Winterfell success Targetin
Slide 12: 2021: Base Business Growth Expected as Drilling Increases
2021: Base Business Growth Expected as Drilling Increases Back to business – Planned increased activity expected to grow production through 2021 Ghana Equatorial Guinea Gulf of Mexico • CALM buoy in place 1Q21 • Phase 2 of the ESP program began in • Kodiak-2 completion currently February underway –
Slide 13: 2021: Tortue – A Year of Delivery
2021: Tortue – A Year of Delivery Greater Tortue project gathering significant momentum in Mauritania/Senegal Year End 2020: Phase 1 ~50% Complete Strong 4Q20 momentum expected to continue in 2021 Subsea: • Tortue Phase 1 remains on track for first gas ~40% complete 1H 2023 – All workstreams on trac
Slide 14: Tortue: Right Project, Right Time
Tortue: Right Project, Right Time Recent record LNG prices signal a tightening market Favorable outlook for phased Tortue development The Macro Outlook For Gas Continues To Improve1 • Global LNG supply growth in 2020 the lowest since 2014 700 208 MTPA 50 – Only 5 MTPA of new supply added 600 mtpa 17
Slide 15: 2021: Proven Basin Exploration Strategy Delivering Results
2021: Proven Basin Exploration Strategy Delivering Results Flexibility to deploy capital across three basins Gulf of Mexico Equatorial Guinea Ghana Identified prospects on Kosmos acreage Prospects being drilled in 2021 • Extensive inventory of opportunities across our proven basin acreage positions
Slide 16: FY21 Guidance and Capital Program
FY21 Guidance and Capital Program Disciplined capital program in 2021 Key FY21 Guidance Items Production 53-57,000 boepd Base Business Capex $225-$275 million Base Business FCF1 (@$55 Brent) $100-$200 million Base business capex focused on growing production and high- FY21 Base Business Capital Prog
Slide 17: Advantaged Portfolio – Low Cost and Lower Carbon
Advantaged Portfolio – Low Cost and Lower Carbon Kosmos is building a portfolio that competes in the Energy Transition Emissions Intensity for US Crude Importers1 70 60 50 tCO2e/kboe 40 30 20 10 0 Venezuela Iraq Nigeria Canada Colombia US Rockies US Alaska Mexico US Permian Russia Brazil US GoM Saud
Slide 18: Sustainability Focus Across the Company
Sustainability Focus Across the Company Strong environmental, social, and governance performance Environment Social Performance Governance • Scenario analysis in Climate Risk • Award-winning Kosmos • Leading industry position on and Resilience Report contributed Innovation Center nurtures transparen
Slide 19: A Portfolio to Deliver FCF and Shareholder Value
A Portfolio to Deliver FCF and Shareholder Value High quality conventional portfolio with strong ESG credentials World Class Returns Focused Conventional Assets Exploration Portfolio • Atlantic Margin, conventional deepwater strategy • Proven basins with Kosmos deep technical capability • Diverse pr
Slide 20: Kosmos Energy
KOSM**S ENERGY.
Slide 21: Appendix: FY21 Detailed Guidance
Appendix: FY21 Detailed Guidance 1Q 2021 FY 2021 Production1,2 52,000 – 54,000 boe/day 53,000 – 57,000 boe/day Opex $14.00 – $15.00/boe $14.50 – $16.50/boe DD&A $20.00 – $22.00/boe $21.00 – $23.00/boe G&A (~60% cash) $22 – $24 million $85 – $95 million Exploration Expense3 ~$5 – $10 million ~$35 –$4