Kosmos Energy Ltd.
For the period ended Jun 30, 2025. Filed Aug 4, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 4, 2025
KOS$2.11-4.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-06.
0001509991-25-000032
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-04.
0001509991-25-000063
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 117 previous paragraphs and 126 current paragraphs.
90 unchanged; 22 reworded; 12 added; 4 removed; 1 previous and 2 current paragraphs rearranged.
Tables are not compared: 6 previous and 7 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (12)
Current report
Jubilee development drilling progressed in the second quarter of 2025 with the drilling of one producer well. The well was successfully brought online in July 2025. The rig is currently undergoing scheduled maintenance and then is planned to return to drill and complete one additional producer well in the Jubilee Field in the fourth quarter of 2025 to be followed by a planned four-well drilling campaign in 2026.
Current report
In June 2025, the Jubilee and TEN partnerships entered into a Memorandum of Understanding with the Government of Ghana to extend to 2040 the WCTP and the DT licenses, which cover the Jubilee and TEN fields offshore Ghana. The partnership is currently working on a Jubilee Plan of Development Amendment to be submitted for approval, a new gas sales agreement covering future gas sales from the Jubilee Field, as well as the necessary submissions for parliamentary approval. All of which are expected to be submitted before the end of the third quarter of 2025.
Current report
Production from the Gulf of America averaged approximately 19,600 Boepd net (~84% oil) for the second quarter of 2025.
Current report
Sao Tome and Principe
Current report
In May 2025, we received approval for a twelve month extension to May 2026 for the current exploration phase for Block 5 offshore Sao Tome and Principe.
Current report
In July 2025, new U.S tax legislation was signed into law in the United States known as the "One Big Beautiful Bill Act" or "OBBBA". The legislation includes a broad range of U.S. corporate tax reform provisions affecting businesses across numerous industries. We are currently in the process of evaluating the implications of this new legislation and the potential impact to the Company. The legislation was signed into law after the close of our second quarter, and therefore no adjustments have been made in our operating results for the six months ended June 30, 2025. Additional disclosures will be provided in future periods if necessary as the impact of the legislation is determined.
Current report
Six months ended June 30, 2025 compared to six months ended June 30, 2024
Current report
Oil and gas revenue. Oil and gas revenue decreased by $187.2 million during the six months ended June 30, 2025, as compared to the six months ended June 30, 2024 primarily as a result of lower average realized oil and gas prices and lower sales volume at Jubilee driven by lower production and owing to the two week planned shutdown. We sold 11,109 MBoe at an average realized price per barrel equivalent of $61.46 during the six months ended June 30, 2025 and 11,653 MBoe at an average realized price per barrel equivalent of $74.66 during the six months ended June 30, 2024.
Current report
Oil and gas production. Oil and gas production costs increased by $166.1 million during the six months ended June 30, 2025, as compared to the six months ended June 30, 2024 primarily as a result of operating costs associated with the ramp-up of LNG production at the GTA Phase 1 project in Mauritania and Senegal.
Current report
Exploration expenses. Exploration expenses decreased by $11.6 million during the six months ended June 30, 2025, as compared to the six months ended June 30, 2024 primarily as a result of decreased geological and geophysical studies and related costs as part of the Company’s focus on managing costs across our portfolio.
Current report
Interest and other financing costs, net. Interest and other financing costs, net increased $52.9 million during the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, primarily as a result of decreased capitalized interest related to the GTA Phase 1 project post first gas production in December 2024 partially offset by a $22.0 million loss on debt modifications and extinguishments related to the amendment and restatement of the Facility during the second quarter of 2024.
Current report
Income tax expense. For the six months ended June 30, 2025 and 2024, our overall effective tax rates were impacted by the difference in our 21% U.S. income tax reporting rate and the 35% statutory tax rate applicable to our Ghanaian and 25% statutory tax rate applicable to our Equatorial Guinean operations, jurisdictions that have a 0% statutory tax rate or where we have incurred losses and have recorded valuation allowances against the corresponding deferred tax assets, and other non-deductible expenses, primarily in the U.S.
Removed paragraphs (4)
Previous report
The partnership completed a new 4D seismic survey on the Jubilee and TEN Fields during the first quarter of 2025 with processing currently underway. In December 2024, Tullow as the operator, entered into a drilling rig contract for the next development drilling campaign in the Jubilee Field, which is expected to commence in the second quarter of 2025. The campaign is planned to include the drilling and completion of two in-fill wells in the Jubilee Field in 2025 and a planned four-well drilling campaign in the Jubilee Field in 2026.
Previous report
Production from the Gulf of America averaged approximately 17,200 Boepd net (~85% oil) for the first quarter of 2025, including the impact of the one month scheduled shutdown at Devils Tower, the host facility for the Kodiak field.
Previous report
In the fourth quarter of 2024, the corporate tax rate in Equatorial Guinea was reduced from 35% to 25%, with an effective date of January 1, 2025.
Previous report
During the first quarter of 2025, low-rate subsea gas bubbles were discovered at the GTA A02 well offshore Mauritania during a planned commissioning test. The well has been capped which stopped the minor release. The A02 well is one of four wells for GTA Phase 1, and ramp-up and commissioning activities at GTA are not expected to be impacted while the A02 well is unavailable. Insurance proceeds are expected to cover a substantial portion of the costs for any repair of the well.
Reworded paragraphs (22)
Previous wording
During the first quarter of 2025, Ghana production averaged approximately 99,300 Boepd gross (33,000 Boepd net), including the partial impact on the quarter of the two week scheduled shutdown of the Jubilee FPSO.
Current wording
During the second quarter of 2025, Ghana production averaged approximately 87,800 Boepd gross (29,100 Boepd net), including the partial impact on the quarter of the two week scheduled shutdown of the Jubilee FPSO.
Previous wording
In July 2024, we announced start-up of oil production from the first phase of the Winterfell development in the Green Canyon area of the Gulf of America (25% working interest). In October 2024, shortly after startup of the third well, production at the field was curtailed due to sand production from the third well seen at the production facility. Production from the first two wells was restored in December 2024. Remediation work on Winterfell-3 was performed in the first quarter of 2025, however was unsuccessful. Winterfell-3 has now been temporarily plugged and abandoned while the partnership evaluates options to restore production from the Winterfell-3 fault block. The drilling rig has moved to drill and complete Winterfell-4, commencing the second phase of the Winterfell development project. Winterfell-4 is expected online in the third quarter of 2025.
Current wording
In July 2024, we announced start-up of oil production from the first phase of the Winterfell development in the Green Canyon area of the Gulf of America (25% working interest). In October 2024, shortly after startup of the third well, production at the field was curtailed due to sand production from the third well. Production from the first two wells was restored in December 2024. Remediation work on Winterfell-3 was performed in the first quarter of 2025, however, it was unsuccessful. Winterfell-3 was temporarily plugged and abandoned during the first quarter of 2025 while the partnership evaluates options to restore production from the Winterfell-3 fault block. The Winterfell development drilling project continued to make progress during the second quarter of 2025 with the drilling of Winterfell-4. Completion operations on Winterfell-4 are currently underway with the well expected online later in the third quarter of 2025.
Previous wording
Production in Equatorial Guinea averaged approximately 25,700 Bopd gross (9,000 Bopd net) in the first quarter of 2025.
Current wording
Production in Equatorial Guinea averaged approximately 22,000 Bopd gross (7,700 Bopd net) in the second quarter of 2025, lower than expectations due to subsea multiphase flow pump (MPP) mechanical failures at Ceiba during the quarter. The partnership has agreed a plan to repair and replace the pumps with the first replacement pump expected to be installed in the fourth quarter of 2025.
Previous wording
Production in Mauritania and Senegal averaged approximately 5,100 Boepd gross (1,300 Boepd net) in the first quarter of 2025, as production from the GTA field was ramping up.
Current wording
Production in Mauritania and Senegal averaged approximately 29,200 Boepd gross (7,100 Boepd net) in the second quarter of 2025, as production from the GTA field was ramping up.
Previous wording
The Greater Tortue Ahmeyim (GTA) liquified natural gas (LNG) project achieved first gas production from the subsea system to the FPSO on December 31, 2024. First LNG was achieved in February 2025 and the partnership expects to achieve the ramp-up to the daily contracted sales volume, equivalent to approximately 2.45 million tonnes per annum, in the second quarter of 2025. The first LNG cargo was successfully completed in April 2025, with the second cargo currently lifting.
Current wording
The Greater Tortue Ahmeyim (GTA) liquified natural gas (LNG) project achieved first gas production from the subsea system to the FPSO on December 31, 2024. First LNG was achieved in February 2025 and the first gross LNG cargo was successfully exported in April 2025 with six gross cargoes exported through July 2025. Additionally, the Gimi FLNG vessel Commercial Operations Date was achieved in the second quarter of 2025 with successful ramp-up to the daily contracted sales volume level under the Tortue Phase 1 SPA, equivalent to approximately 2.45 million tonnes per annum.
Previous wording
All of our results, as presented in the table below, represent operations from Ghana, Equatorial Guinea, Mauritania, Senegal and the Gulf of America. Certain operating results and statistics for the three months ended March 31, 2025 and 2024 are included in the following tables:
Current wording
All of our results, as presented in the table below, represent operations from Ghana, Equatorial Guinea, Mauritania, Senegal and the Gulf of America. Certain operating results and statistics for the three and six months ended June 30, 2025 and 2024 are included in the following tables:
Previous wording
(1)Includes $58.1 million related to the LNG production at the GTA Phase 1 project in Mauritania and Senegal. All gas sales in Mauritania and Senegal are LNG sales. First LNG was achieved in February 2025.
Current wording
(1)Includes $69.1 million and $127.2 million for the three and six months ended June 30, 2025, respectively, related to the LNG production at the GTA Phase 1 project in Mauritania and Senegal. All gas sales in Mauritania and Senegal are LNG sales. First LNG was achieved in February 2025 and the first LNG cargo was successfully completed in April 2025.
Previous wording
Oil and gas revenue. Oil and gas revenue decreased by $129.0 million during the three months ended March 31, 2025 as compared to the three months ended March 31, 2024 primarily as a result of lower production at Jubilee, the timing of our oil liftings in Equatorial Guinea and lower average realized oil and gas prices. We sold 4,445 MBoe at an average realized price per barrel equivalent of $65.27 during the three months ended March 31, 2025 and 5,701 MBoe at an average realized price per barrel equivalent of $73.52 during the three months ended March 31, 2024.
Current wording
Oil and gas revenue. Oil and gas revenue decreased by $58.3 million during the three months ended June 30, 2025 as compared to the three months ended June 30, 2024 primarily as a result of lower average realized oil and gas prices. We sold 6,663 MBoe at an average realized price per barrel equivalent of $58.93 during the three months ended June 30, 2025 and 5,954 MBoe at an average realized price per barrel equivalent of $75.73 during the three months ended June 30, 2024.
Previous wording
Oil and gas production. Oil and gas production costs increased by $73.7 million during the three months ended March 31, 2025 as compared to the three months ended March 31, 2024 primarily as a result of the inclusion of operating costs associated with LNG production at the GTA Phase 1 project in Mauritania and Senegal, costs related to the scheduled shutdown and maintenance activities in Ghana, and workovers in the Gulf of America.
Current wording
Oil and gas production. Oil and gas production costs increased by $92.4 million during the three months ended June 30, 2025 as compared to the three months ended June 30, 2024 primarily as a result of increased sales volumes and operating costs associated with the ramp-up of LNG production at the GTA Phase 1 project in Mauritania and Senegal.
Previous wording
Exploration expenses. Exploration expenses decreased by $2.4 million during the three months ended March 31, 2025, as compared to the three months ended March 31, 2024 primarily as a result of decreased seismic data acquisition costs in the Gulf of America business unit.
Current wording
Exploration expenses. Exploration expenses decreased by $9.2 million during the three months ended June 30, 2025, as compared to the three months ended June 30, 2024 primarily as a result of decreased geological and geophysical studies and related costs as part of the Company’s focus on managing costs across our portfolio.
Previous wording
Depletion, depreciation and amortization. Depletion, depreciation and amortization increased by $19.7 million during the three months ended March 31, 2025, as compared with the three months ended March 31, 2024 primarily as a result of higher depletion rates per boe across our portfolio as a result of increased cost basis related to the respective development activities in 2024 and increased production in the Gulf of America, partially offset by the lower sales volumes in Ghana and Equatorial Guinea.
Current wording
Depletion, depreciation and amortization. Depletion, depreciation and amortization increased by $61.2 million during the three months ended June 30, 2025, as compared with the three months ended June 30, 2024 primarily as a result of increased sales volumes and higher depletion rates per boe across our portfolio owing to increased cost basis related to the respective development activities in 2024.
Previous wording
Interest and other financing costs, net. Interest and other financing costs, net increased by $35.4 million during the three months ended March 31, 2025, as compared to the three months ended March 31, 2024 primarily as a result of decreased capitalized interest related to the GTA Phase 1 project commencing first gas production in December 2024.
Current wording
Interest and other financing costs, net. Interest and other financing costs, net increased by $17.6 million during the three months ended June 30, 2025, as compared to the three months ended June 30, 2024 primarily as a result of decreased capitalized interest related to the GTA Phase 1 project post first gas production in December 2024 partially offset by a $22.0 million loss on debt modifications and extinguishments related to the amendment and restatement of the Facility during the second quarter of 2024.
Previous wording
Derivatives, net. During the three months ended March 31, 2025 and 2024, we recorded a loss of $6.7 million and a loss of $23.8 million, respectively, on our outstanding hedge positions. The amounts recorded were a result of changes in the forward oil price curve during the respective periods.
Current wording
Derivatives, net. During the three months ended June 30, 2025 and 2024, we recorded a gain of $21.6 million and a gain of $2.9 million, respectively, on our outstanding hedge positions. The amounts recorded were a result of changes in the forward oil price curve during the respective periods.
Previous wording
Income tax expense. For the three months ended March 31, 2025 and 2024, changes to our effective tax rates are driven by which tax jurisdictions our income before income taxes is generated. The jurisdictions in which we operate have statutory tax rates ranging from 0% to 35%.
Current wording
Income tax expense. For the three months ended June 30, 2025 and 2024, changes to our effective tax rates are driven by which tax jurisdictions our income (loss) before income taxes is generated. The jurisdictions in which we operate have statutory tax rates ranging from 0% to 35%.
Previous wording
As of March 31, 2025, borrowings under the Facility totaled $1.0 billion and the undrawn availability under the Facility was $350.0 million. In March 2025, during the Spring 2025 redetermination, the Company’s lending syndicate approved a borrowing base at the full Facility size of $1.35 billion.
Current wording
As of June 30, 2025, borrowings under the Facility totaled $1.0 billion and the undrawn availability under the Facility was $350.0 million. In March 2025, during the Spring 2025 redetermination, the Company’s lending syndicate approved a borrowing base at the full Facility size of $1.35 billion. In July 2025, the Company and the Facility lenders agreed to amend the debt cover ratio required under the Facility. The amendment makes this covenant less restrictive for the next two scheduled financial covenant assessment dates in September 2025 and March 2026, up to a maximum of 4.0x and 4.25x, respectively, and thereafter returns to the originally agreed upon ratio of 3.50x for assessment dates thereafter. The change is intended to align the covenant calculation with recent business operations, lower oil prices and the impact of pre-production operating costs associated with the GTA Phase 1 project on our results of operations.
Previous wording
The following table presents the sources and uses of our cash and cash equivalents and restricted cash for the three months ended March 31, 2025 and 2024:
Current wording
The following table presents the sources and uses of our cash and cash equivalents and restricted cash for the six months ended June 30, 2025 and 2024:
Previous wording
Net cash provided by (used in) operating activities. Net cash used in operating activities for the three months ended March 31, 2025 was $0.9 million compared with net cash provided by operating activities for the three months ended March 31, 2024 of $272.6 million. The decrease in cash provided by operating activities in the three months ended March 31, 2025 when compared to the same period in 2024 is primarily a result of lower sales volumes in Ghana and Equatorial Guinea, lower average realized oil and gas prices, higher oil and gas production costs related to the inclusion of operating costs associated with LNG production at the GTA Phase 1 project and costs related to the scheduled shutdown and maintenance activities in Ghana and workovers in the Gulf of America for the three months ended March 31, 2025.
Current wording
Net cash provided by operating activities. Net cash provided by operating activities for the six months ended June 30, 2025 was $126.3 million compared with net cash provided by operating activities for the six months ended June 30, 2024 of $496.2 million. The decrease in cash provided by operating activities in the six months ended June 30, 2025 when compared to the same period in 2024 is primarily a result of lower average realized oil and gas prices, lower sales volumes in Ghana and higher oil and gas production costs related to the ramp-up of LNG production at the GTA Phase 1 project for the six months ended June 30, 2025.
Previous wording
We expect to incur capital costs as we:
Current wording
For our 2025 capital expenditure budget, we expect to incur capital costs as we:
Previous wording
We estimate we will spend $400 million or less of capital for the year ending December 31, 2025, excluding any acquisitions or divestiture of oil and gas properties during the year. This capital expenditure budget consists of:
Current wording
We estimate we will spend approximately $350 million of capital for the year ending December 31, 2025, excluding any acquisitions or divestiture of oil and gas properties during the year. This capital expenditure budget consists of:
Previous wording
•Less than $75 million related to progressing our appraisal and development programs in the Gulf of America, Mauritania and Senegal.
Current wording
•Approximately $25 million related to progressing our appraisal and development programs in the Gulf of America, Mauritania and Senegal.
Previous wording
If an event of default exists under the Facility, the lenders can accelerate the maturity and exercise other rights and remedies, including the enforcement of security granted pursuant to the Facility over certain assets. We were in compliance with the financial covenants contained in the Facility as of March 31, 2025 (the most recent assessment date). The Facility contains customary cross default provisions.
Current wording
If an event of default exists under the Facility, the lenders can accelerate the maturity and exercise other rights and remedies, including the enforcement of security granted pursuant to the Facility over certain assets. In July 2025, the Company and the Facility lenders agreed to amend the debt cover ratio required under the Facility. The amendment makes this covenant less restrictive for the next two scheduled financial covenant assessment dates in September 2025 and March 2026, up to a maximum of 4.0x and 4.25x, respectively, and thereafter returns to the originally agreed upon ratio of 3.50x for assessment dates thereafter. The change is intended to align the covenant calculation with recent business operations, lower oil prices and the impact of pre-production operating costs associated with the GTA Phase 1 project on our results of operations. We were in compliance with the financial covenants contained in the Facility as of March 31, 2025 (the most recent assessment date). The Facility contains customary cross default provisions.
Previous wording
In February 2019, Kosmos and BP signed Carry Advance Agreements with the national oil companies of Mauritania and Senegal, which obligate us separately to finance the respective national oil companies’ share of certain development and production costs incurred for the GTA Phase 1 project. Kosmos’ total share for the two agreements combined is currently estimated at approximately $370.0 million, of which $312.7 million has been incurred through March 31, 2025, excluding accrued interest. The amount financed by Kosmos is to be repaid through the national oil companies’ share of future revenues.
Current wording
In February 2019, Kosmos and BP signed Carry Advance Agreements with the national oil companies of Mauritania and Senegal, which obligate us separately to finance the respective national oil companies’ share of certain development and production costs incurred for the GTA Phase 1 project through the Commercial Operations Date of the Gimi FLNG vessel. The Commercial Operations Date was achieved in June 2025 following the successful ramp-up to the daily contracted sales volume level under the Tortue Phase 1 SPA, equivalent to approximately 2.45 million tonnes per annum. Kosmos’ total share, excluding accrued interest, for the two agreements combined as of June 30, 2025 and December 31, 2024, was $355.5 million and $280.1 million, respectively, which is classified as Long-term receivables in our consolidated balance sheets. The amount financed by Kosmos is expected to be repaid through the national oil companies’ share of future revenues.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Depletion, depreciation and amortization. Depletion, depreciation and amortization increased $80.9 million during the six months ended June 30, 2025, as compared with the six months ended June 30, 2024 primarily as a result of higher depletion rates per boe across our portfolio owing to increased cost basis related to the respective development activities in 2024.
Current report — wording carried from elsewhere
Derivatives, net. During the six months ended June 30, 2025 and 2024, we recorded a gain of $14.8 million and a loss of $21.0 million, respectively, on our outstanding hedge positions. The changes recorded were a result of changes in the forward curve of oil prices during the respective periods.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
In March 2025, during the Spring 2025 redetermination, the Company’s lending syndicate approved a borrowing base at the full Facility size of $1.35 billion.