Kosmos Energy reports wider fourth-quarter loss

(Sharecast News) - Kosmos Energy reported a wider fourth-quarter net loss on Monday as it booked impairments and write-offs, while outlining plans to lift production, cut costs and reduce debt in 2026.

For the three months ended 31 December, the deepwater exploration and production group posted a net loss of $377m, or 79cents per diluted share, compared with an adjusted net loss of $78m, or 16cents per share, after excluding certain items affecting comparability.

Revenues were $295m, equivalent to $50.88 per barrel of oil equivalent excluding derivative cash settlements.

Production expenses totalled $151m, or $22.24 per equivalent barrel, excluding $50.9m of costs associated with the Greater Tortue Ahmeyim (GTA) LNG project.

Net production averaged around 67,900 barrels of oil equivalent per day, up about 4% on the third quarter, with sales of approximately 62,900 boepd.

The company exited the quarter in a net underlift position of roughly 1.1m equivalent barrels.

Capital expenditure was $53m in the quarter, taking full-year capex to $292m, around 25% below initial 2025 guidance.

Results were impacted by a $144m write-off of suspended well costs related to the Yakaar-Teranga fields in Senegal and impairments of about $178m in the Gulf of America, largely linked to Winterfell.

Kosmos ended 2025 with net debt of approximately $3bn and liquidity of around $342m.

Operationally, GTA Phase 1 net production averaged about 14,200 boepd during the quarter as the project ramped to the floating LNG vessel's nameplate capacity of 2.7m tonnes per annum equivalent, averaging nameplate production through December.

Year-to-date output had averaged around 2.9 mtpa equivalent in 2026, with gross LNG cargoes expected to roughly double year on year.

Net operating costs per boe at GTA phase one were expected to fall by more than 50% in 2026, including the impact of FPSO refinancing completed in January.

In Ghana, net production averaged approximately 31,100 boepd in the fourth quarter.

Gross Jubilee output was about 59,100 bopd, with a second producer well in the 2025-2026 drilling campaign coming online in January at around 13,000 bopd, lifting gross Jubilee production above 70,000 bopd in February.

The licences for the Jubilee and TEN fields were extended to 2040 following ratification by Ghana's parliament, increasing 1P and 2P reserves.

Group 1P reserves at year-end were around 250m barrels of oil equivalent, representing a reserve life of about 10 years, with a 1P replacement rate of roughly 90%, or 120% excluding assets being disposed of in Equatorial Guinea.

2P reserves were about 500 mmboe, equating to around 20 years of reserve life.

In February, Kosmos agreed to sell its 40.375% non-operating interest in the Ceiba Field and Okume Complex offshore Equatorial Guinea to Panoro Energy for up to $220m, including $180m upfront and contingent payments.

Proceeds would be used to reduce borrowings under its reserve-based lending facility.

During the quarter and into early 2026, Kosmos refinanced its near-term maturities, redeeming its remaining 2026 senior unsecured notes using proceeds from a term facility and completing a $350m senior secured Nordic bond offering.

RBL lenders approved an amended debt cover ratio for the next two test dates to reflect higher start-up costs at GTA.

"2025 was a year of laying the foundation for improved operational and financial performance," said chairman and chief executive Andrew G Inglis.

"In the past few months, we are starting to see the results of the team's hard work and expect to deliver more wins in 2026 as we continue to grow production, reduce costs and enhance the resilience of our balance sheet.

"With both of these key assets delivering as anticipated, we expect 2026 production growth of around 15% year-on-year."

On costs and leverage, Inglis said that "in 2026, we intend to keep capex levels low and also drive a material reduction in operating costs of around 20% year-on-year."

He added that the company was targeting "at least 10% debt reduction by year-end" as it focuses on free cash flow generation and non-core asset sales.

At 0848 GMT, shares in Kosmos Energy were up 11.18% at 184p.

Reporting by Josh White for Sharecast.com.