Financial Data and Key Metrics Changes - Production increased by 15% to 4,013 BOE per day in 2025, with a compound annual growth rate of 35% over the last three years [4][7] - Net revenue decreased by 3% to $56.9 million due to a 60% decline in prices, which offset the production increase [8] - Adjusted EBITDA decreased by 4% to $42.1 million compared to $44 million in 2024 [8] - Net income was $15.5 million with basic EPS of $0.44 per share, down from $18.1 million and $0.51 per share in 2024 [8] - Operating expenses per BOE decreased by 1% to $7.33 from $7.44 in 2024 [8] - Netback from operations decreased by 18% to $31.49 per BOE compared to $38.54 in the prior year [9] Business Line Data and Key Metrics Changes - The drilling program led to a 30% increase in approved developed producing reserves [5] - Production from new wells drilled in 2025, including four completed at the end of the year, increased December production to over 5,600 BOE per day [7] Market Data and Key Metrics Changes - The first year's price used in reserve evaluations dropped by 18% to $58 per barrel, while current oil prices are averaging in the 90s [5] Company Strategy and Development Direction - The company plans to continue drilling additional wells in the coming months to maintain growth [10] - The strategy includes a share buyback program, with nearly 650,000 shares repurchased for $3.2 million [9] - The company aims to enhance shareholder value while navigating the current oil price environment [10] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the drilling program for 2026, indicating a potential increase in wells drilled compared to previous plans [19] - The company is prepared to pivot quickly in response to market conditions due to its flexible operational structure [21] - Management noted that the timing of the recent oil price increase is benefiting cash flow [10] Other Important Information - The company has implemented a hedging program, with costless collars in place for 16,000 barrels of oil per day [60] - Approximately 50% of production remains unhedged, allowing for potential upside in pricing [64] Q&A Session Summary Question: How is the drilling program for this year being adjusted in light of recent price changes? - Management is cautiously optimistic and plans to start drilling additional wells, with flexibility to adjust based on market conditions [19][20] Question: What is the expected timeline for starting the drilling program? - The target is to start drilling around June, but management hopes to begin sooner if conditions allow [22] Question: Can you provide insight into the realized natural gas prices? - Management indicated that natural gas prices fluctuate and are difficult to forecast due to reliance on Exxon for pricing [26][30] Question: What is the expected capital expenditure for 2026? - Management anticipates a lower capital expenditure than in 2025, with plans to drill around three wells unless higher oil prices prompt additional drilling [55][57] Question: Can you summarize the hedging program for the first quarter and the full year? - The company has costless collars in place for the first quarter and has hedged a portion of production for the second half of the year [60][68]

Financial Data and Key Metrics Changes - Production increased by 15% to 4,013 BOE per day in 2025, with a compound annual growth rate of 35% over the last three years [4][8] - Net revenue decreased by 3% to $56.9 million, primarily due to a 60% decline in prices [8] - Adjusted EBITDA decreased by 4% to $42.1 million compared to $44 million in the previous year [8] - Net income was $15.5 million with basic EPS of $0.44 per share, down from $18.1 million and $0.51 per share in 2024 [8] - Operating expenses per BOE decreased by 1% to $7.33 from $7.44 in 2024 [8][9] - Netback from operations decreased by 18% to $31.49 per BOE compared to $38.54 per BOE in the prior year [9] Business Line Data and Key Metrics Changes - The drilling program led to a 30% increase in approved developed producing reserves [5] - Production from new wells completed in 2025 contributed to a December production rate exceeding 5,600 BOE per day [7] Market Data and Key Metrics Changes - The first year's price used in reserve evaluations dropped by 18% to $58 per barrel, contrasting with current average oil prices in the 90s [5] Company Strategy and Development Direction - The company plans to drill additional wells in the coming months to continue its growth trajectory [10] - The strategy includes a share buyback program, with nearly 650,000 shares repurchased for $3.2 million [9] - The company aims to maintain a cautious approach while being prepared to ramp up drilling if market conditions allow [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the drilling program and oil prices, indicating a flexible approach to adapt to market changes [19][20] - The company is positioned to benefit from elevated oil prices, which are expected to enhance cash flow [10] - Management emphasized the importance of maintaining a solid financial shape despite challenging oil prices [10] Other Important Information - The company has a hedging program in place, with costless collars for Q1 and additional hedges for the second half of the year [58][67] - The royalty percentage varies based on production location, averaging around 22% [73] Q&A Session Summary Question: How is the drilling program for this year being adjusted in light of recent price changes? - Management is cautiously optimistic and plans to start drilling additional wells, with flexibility to adapt based on market conditions [19][20] Question: Can you provide a ballpark figure for CapEx in 2026? - Management indicated that CapEx would likely be lower than the previous year unless more wells are drilled due to higher oil prices [55][57] Question: What is the status of the hedging program for Q1 and the full year? - The company has costless collars in place for Q1 and has hedged a portion of production for the second half of the year [58][67] Question: How might the royalty per barrel change in 2026? - The royalty percentage is expected to fluctuate based on production location and pricing, averaging around 22% [73]

Financial Data and Key Metrics Changes - Production increased by 15% to 4,013 BOE per day in 2025, with a compound annual growth rate of 35% over the last three years [4][6] - Net revenue decreased by 3% to $56.9 million due to a 60% decline in prices, which offset the production increase [7] - Adjusted EBITDA decreased by 4% to $42.1 million compared to $44 million in the previous year [8] - Net income was $15.5 million with basic EPS of $0.44 per share, down from $18.1 million and $0.51 per share in 2024 [8] - Operating expenses per BOE decreased by 1% to $7.33 from $7.44 in 2024 [8] - Netback from operations decreased by 18% to $31.49 per BOE compared to $38.54 in the prior year [9] Business Line Data and Key Metrics Changes - The drilling program led to a 30% increase in approved developed producing reserves [5] - Production from new wells completed in 2025 contributed to a December production rate exceeding 5,600 BOE per day [6] Market Data and Key Metrics Changes - The first year's price used in reserve evaluations dropped by 18% to $58 per barrel, while current oil prices are averaging in the 90s [5] - The company is benefiting from elevated oil prices, which are expected to positively impact cash flow [11] Company Strategy and Development Direction - The company plans to continue drilling additional wells and executing its growth strategy to enhance shareholder value [11][12] - The management is cautiously optimistic about the drilling program for 2026, with plans to start drilling in the coming months [19][23] - The company aims to maintain production levels and potentially increase them depending on market conditions and oil prices [56] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by lower oil prices in 2025 but emphasized solid financial performance and growth potential [11] - The company is prepared to pivot quickly in response to market changes due to its flexible operational structure [21][22] - Management expressed confidence that oil prices will remain higher than previous levels, regardless of geopolitical developments [20] Other Important Information - The company has repurchased nearly 650,000 shares for a total of $3.2 million as part of its share buyback program [9] - The company has hedged a portion of its production, with costless collars in place for the first quarter and additional hedges for the second half of the year [61][70] Q&A Session Summary Question: How is the drilling program for this year being adjusted in light of recent price changes? - Management is cautiously optimistic and plans to start drilling additional wells, with flexibility to adjust based on market conditions [19][20] Question: What is the expected timeline for starting this year's drilling program? - Management indicated a target start date around June, but hopes to begin sooner if conditions allow [23] Question: Can you provide insight into the realized natural gas prices and their fluctuations? - Management noted that natural gas prices are difficult to forecast due to variability in market conditions and sales handled by Exxon [27][31] Question: What is the expected capital expenditure for 2026? - Management suggested that capital expenditures would be lower than in 2025 unless more wells are drilled, with a goal of maintaining or slightly increasing production [56][58] Question: Can you summarize the hedging program for the upcoming quarters? - Management detailed the hedging strategy, including costless collars for the first quarter and additional hedges for the second half of the year [61][70]

Financial Data and Key Metrics Changes - In 2025, the company generated over $750 million in adjusted EBITDAX and reported a net loss of $41.4 million due to a non-cash impairment charge of $67.2 million from the sale of Canadian assets [5][25][26] - The company reported production of 16,556 net revenue interest barrels of oil equivalent per day, exceeding guidance [25] - SEC proved reserves decreased by 5% year-over-year to 43 million barrels of oil equivalent, but the SEC proved reserve PV-10 increased by 8% to $410 million due to positive revisions [20][21] Business Line Data and Key Metrics Changes - The company divested all Canadian assets and expanded its Côte d'Ivoire position by becoming the operator with a 60% working interest in the Kossipo field [5][6] - In Gabon, the company began a phase three drilling program and successfully completed a full field maintenance shutdown [12][15] - The FPSO refurbishment in Côte d'Ivoire was completed ahead of schedule, with production expected to restart in Q2 2026 [8][9] Market Data and Key Metrics Changes - The company reported a favorable oil price adjustment in Gabon, contributing to an income tax benefit of $4.6 million in Q4 2025 [28] - The average SEC pricing was around $70 per barrel, impacting the company's financial results [21] Company Strategy and Development Direction - The company aims to achieve a production target of 50,000 barrels of oil equivalent per day and continues to focus on operational excellence and organic growth initiatives [5][6] - The company is exploring new development opportunities in Equatorial Guinea and evaluating alternative technical solutions for enhanced economic value [19][41] - The strategy includes maximizing asset value, rationalizing the portfolio, and pursuing accretive opportunities [40][42] Management's Comments on Operating Environment and Future Outlook - Management indicated that 2025 was a transitional year, with significant production uplifts expected from ongoing projects in 2026 and 2027 [7][25] - The company expressed confidence in its diversified portfolio and the potential for substantial increases in sales and adjusted EBITDAX in the future [38][39] Other Important Information - The company returned $26.5 million to shareholders through dividends in 2025 and has a strong cash position with unrestricted cash increasing to $58.9 million [7][30] - The company has a capital expenditure forecast for 2026 between $290 million and $360 million, focusing on drilling campaigns and FPSO refurbishment [37] Q&A Session All Questions and Answers Question: Can you provide more granularity on CapEx in Côte d'Ivoire? - The majority of Q1 CapEx is linked to the Gabon drilling program and FPSO finalization, with around $10 million for Kossipo preparation [46][48] Question: What is the expected residual CapEx for drilling in Côte d'Ivoire in 2027? - The CapEx for Q4 2026 drilling is projected to be between $30 million and $45 million [50] Question: Can you discuss the base Brent price forecast embedded in the NRI volume assumptions? - The underlying Brent assumption for 2026 is $65, with profit oil split benefiting from price rises [65][66] Question: Will VAALCO maintain its current working interest in Kossipo and CI-705? - The company is comfortable with its 60% working interest in Kossipo and is currently not planning to farm down its position [68] Question: What is the breakdown of the roughly $150 million CapEx in Côte d'Ivoire? - Approximately $50 million is allocated for the FPSO hookup and recommissioning, with the balance for drilling [74][78] Question: How will the company utilize any excess free cash flow generated? - Excess free cash flow will primarily be used to reduce debt rather than enhance shareholder returns due to high capital commitments [79]

Core Viewpoint - Peyto Exploration & Development demonstrated significant production growth, improved cost efficiency, and debt reduction in 2025, despite facing challenges from low natural gas prices. Financial Performance - In Q4, Peyto reported funds from operations of C$245 million, a 23% increase quarter-over-quarter, and net income of approximately C$126 million, marking one of the highest quarterly earnings in its history [4][9][7] - For the full year, the company generated C$860 million in funds from operations, a 21% increase over 2024, with total cash costs averaging C$1.29 per Mcfe [10] Production and Capital Expenditure - Peyto's exit production rate reached 145,000 BOE/d, with a capital efficiency of about C$10,000 per BOE, achieved by running five rigs and drilling 82 gross wells [5][1] - The company invested C$475 million in 2025, resulting in a 7% increase in annual production and PDP reserves, while also paying C$265 million in dividends and reducing net debt by C$171 million (13%) [2][5] Operational Highlights - The drilling program focused on the high-productivity Notikewin and Falher formations, contributing to a 6% year-over-year increase in average production [7][5] - The company completed 82 gross wells, with 34 of these not previously recognized on its reserve books, indicating strong inventory expansion [13][6] Hedging and Market Strategy - Peyto's hedge book secures C$880 million in revenues for 2026, providing protection against market volatility, with about 70% of gas volumes fixed at prices just under C$4 [16][15] - The company plans to spend C$450 million to C$500 million in 2026, with a focus on drilling 70 to 80 net wells, while remaining flexible to adjust based on market conditions [14] Future Outlook - Management emphasized a steady capital plan for 2026, with the potential to increase rig activity depending on the business environment, including prices and service costs [14] - The company aims to reduce controllable costs by an additional C$0.10 in 2026, building on previous improvements [11]

Financial Data and Key Metrics Changes - Production averaged 18.5 MBOE per day for the full year, a 12% increase on a BOE basis and 32% on oil compared to 2024, with Q4 production averaging 19.5 MBOE per day [3][4] - Revenues for the year were approximately $156 million, representing a 25% increase compared to 2024 [4] - Adjusted EBITDA was roughly $25 million in Q4 and $101 million for the year, compared to $24 million and $69 million in the prior year periods [4][8] - Net income for Q4 was $21.6 million or $0.59 per diluted share, and for the full year, it was $70.2 million or $1.90 per diluted share [7][8] Business Line Data and Key Metrics Changes - The company successfully completed and brought 6 wells online from the operated 1-rig Cherokee drilling program, with an average peak 30-day production rate of approximately 2,000 BOE per day for these wells [11] - Capital expenditures for the quarter were approximately $18 million, with total capital spend for the year at $76.2 million [6][10] Market Data and Key Metrics Changes - Commodity price realizations for the quarter were $57.56 per barrel of oil, $2.20 per MCF of gas, and $14.92 per barrel of NGLs, compared to third quarter realizations of $65.23, $1.71, and $15.61 respectively [6] Company Strategy and Development Direction - The company plans to continue its Cherokee development with one rig throughout 2026, anticipating a 20% growth in oil production volumes [15] - The strategy includes maximizing the value of incumbent MidCon PDP assets, exercising capital stewardship, and maintaining optionality for potential M&A opportunities [19][20] - The company aims to uphold its ESG responsibilities while growing the business in a safe and efficient manner [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the production growth and the potential for attractive returns from Cherokee wells, with break-evens down to $35 WTI [16] - The company has a strong balance sheet with no debt, allowing for flexibility in capital allocation and the ability to respond to commodity price cycles [17][24] Other Important Information - The company paid $4.4 million in dividends during the quarter, with a total of $4.60 per share in dividends paid since the beginning of 2023 [5] - The company has approximately $112 million in cash and cash equivalents, representing over $3 per share of common stock outstanding [24] Q&A Session Summary Question: Can you provide context on the production guidance range for 2026? - Management indicated that timing and working interest could affect the production guidance range, with potential shifts due to crew availability or weather [27][28] Question: How does the current spot market influence hedging positions? - Management noted that they are opportunistic with hedging, having no debt and thus no mandatory hedging requirements, allowing them to layer in additional contracts as prices rise [30][31] Question: Can you comment on the higher price differentials guidance for NGLs? - Management explained that differentials vary by commodity and that higher gas prices could lead to better realizations, while regional basis widening in Q4 was seen as localized and temporal [36][38]

Core Viewpoint - The company anticipates 2025 to be a challenging transitional year with production growth and debt reduction not meeting initial expectations, but it is setting a foundation for delivery in 2026 [1] Group 1: Production and Operational Developments - The Ghana portfolio has been enhanced through license extensions to 2040 and the strategic acquisition of the TEN FPSO, which converts lease payments into capital expenditure to reduce future operating expenses [1] - Greater Tortue Ahmadjian (GTA) reached a significant milestone in December, achieving its 2.7 MTPA nameplate capacity and demonstrating operational stability following a steady ramp-up period [1] - Jubilee's production has recovered to over 70,000 barrels of oil per day (bopd), driven by a return to active drilling, with new wells showing rapid paybacks of six to nine months [1] Group 2: Strategic Decisions and Financial Management - The divestment of Equatorial Guinea assets is a strategic decision aimed at exiting high-operating-cost barrels and accelerating the transition to a lower-cost, higher-margin production base [1] - Improved drilling confidence is attributed to the integration of 4D and OBN seismic data, which enhances the identification of bypassed oil pockets in the core of the field [1]

Financial Data and Key Metrics Changes - The company reported a challenging transitional year in 2025, with production growth slower than expected and net debt ending the year higher than planned [4][5] - CapEx for 2025 was $290 million, a year-on-year reduction of almost 70%, the lowest since 2017 [27] - The company is targeting a CapEx of around $350 million for 2026, including $40 million associated with the TEN FPSO purchase [29][30] Business Line Data and Key Metrics Changes - Jubilee production has grown to over 70,000 barrels of oil per day gross, with five more wells expected to come online in 2026 [6][12] - At GTA, production averaged 2.9 million tons per annum equivalent year to date in 2026, with a target of 32-36 gross LNG cargos for the year [19][20] - The Gulf of Mexico performance was in line with expectations, with good performance from Odd Job and Kodiak, but challenges at Winterfell led to an impairment on those assets [23] Market Data and Key Metrics Changes - The company has a strong reserve replacement ratio of around 90%, which could increase to 120% when adjusting for the recent disposal of assets in Equatorial Guinea [9] - The company expects to see a significant drop in operating costs per MMBtu due to higher production volumes and cost reductions [20][22] Company Strategy and Development Direction - The company aims to build a sustainable lower-cost business, focusing on production growth from core assets while reducing debt [3][4] - There is a commitment to long-term investments in Ghana, with the Ghana licenses extended to 2040, reinforcing the company's strategy in the region [10][11] - The company is actively working to enhance its balance sheet and reduce costs, targeting a debt reduction of at least 10% in 2026 [30][31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operational momentum built in early 2026, with strong progress across production costs and the balance sheet [5][34] - The company anticipates a 15% production growth year-on-year, primarily from Jubilee and GTA assets, alongside a 20% reduction in total operating costs [34] Other Important Information - The company has successfully completed a $350 million bond issuance to enhance liquidity and pay down debt [30][31] - The partnership signed a sale and purchase agreement to acquire the TEN FPSO, which is expected to reduce operating costs significantly from 2026 onwards [15] Q&A Session Summary Question: Can you provide insight on the net adds when bringing new wells online? - Management indicated that the net impact varies by well, with some wells potentially having a minimal backout effect due to pressure relief [38][39] Question: Is there a turnaround baked into the annual cargo guidance for GTA? - Management clarified that the guidance reflects seasonal effects, with stronger performance expected in the first and fourth quarters [48][49] Question: Can you elaborate on the amended debt cover ratio? - Management confirmed constructive conversations with banks, raising the leverage covenant to accommodate historical underperformance and lower oil prices [55][56] Question: How do you view the TEN FPSO purchase in relation to Jubilee? - Management noted that the FPSO purchase lowers the break-even cost and extends the economic life of the TEN field, with potential for future wells [63][64] Question: What is the expected cash OpEx per MMBtu at GTA? - Management indicated that the reduction in OpEx is driven by increased production and FPSO refinancing, with further reductions expected in 2027 [81][82]

Financial Data and Key Metrics Changes - The company reported a challenging transitional year in 2025, with production growth slower than expected and net debt ending the year higher than planned [4][5] - CapEx for 2025 was $290 million, a year-on-year reduction of almost 70%, and the lowest since 2017 [27] - The company is targeting a CapEx of around $350 million for 2026, including $40 million associated with the TEN FPSO purchase [29][34] Business Line Data and Key Metrics Changes - Jubilee production has grown to over 70,000 barrels of oil per day gross, with five more wells expected to come online in 2026 [6][12] - At GTA, production averaged 2.9 million tons per annum equivalent year-to-date, with a target of 32-36 gross LNG cargos for 2026 [19][20] - The Gulf of Mexico performance was in line with expectations, with good performance from Odd Job and Kodiak, but lower performance from Winterfell [23] Market Data and Key Metrics Changes - The company achieved a strong 1P reserves replacement ratio of around 90%, or 120% when excluding the assets being sold in Equatorial Guinea [4][9] - The realized price was lower sequentially due to lower commodity prices, but an increase is expected in Q1 2026 [26] Company Strategy and Development Direction - The company aims to build a sustainable lower-cost business, focusing on production growth from core assets while reducing costs and debt [3][34] - There is a commitment to long-term investments in Ghana, with the Ghana licenses extended to 2040 [10][11] - The company is actively working to enhance its balance sheet, targeting a debt reduction of at least 10% in 2026 [31][34] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that 2025 was a challenging year but laid the groundwork for strong progress in 2026 [5][34] - The company is optimistic about production growth and cost reductions, with a target of 15% production growth year-on-year and a 20% reduction in total operating costs [34] - Management emphasized the importance of continued investment in the oil and gas sector for Ghana's economic growth and energy security [10][11] Other Important Information - The company has completed a $350 million bond issuance to enhance liquidity and pay down debt [30] - The partnership signed a sale and purchase agreement to acquire the TEN FPSO, which is expected to reduce operating costs significantly from 2026 onwards [15][28] Q&A Session Summary Question: Can you provide insight on net adds as new wells come online? - Management indicated that the impact varies by well, with some wells potentially having a net back out close to zero due to pressure relief [38][39] Question: Is there a turnaround baked into the annual cargo guidance for GTA? - Management clarified that the guidance is based on seasonal effects, with stronger performance expected in Q1 and Q4 [48][49] Question: Can you elaborate on the amended debt cover ratio? - Management confirmed constructive conversations with banks, raising the leverage covenant to accommodate historical underperformance and lower oil prices [55][56] Question: How do you view the TEN FPSO purchase in relation to Jubilee? - Management noted that the FPSO purchase lowers the break-even cost and extends the economic life of the TEN field, with potential for future wells [63][64] Question: What is the expected cash OpEx per MMBtu at GTA? - Management indicated that about half of the expected unit cost reduction comes from FPSO refinancing and the other half from operational efficiencies [81][82]

Core Insights - Kosmos Energy Ltd. reported a net loss of $377 million, or $0.79 per diluted share, for Q4 2025, with an adjusted net loss of $78 million, or $0.16 per diluted share [1][3][12] - The company aims to improve operational and financial performance in 2026, focusing on production growth, cost reduction, and balance sheet resilience [3][6][7] Financial Performance - Q4 2025 revenues were $295 million, with production expenses of $151 million and capital expenditures of $53 million [5][11] - Full-year capital expenditures for 2025 were $292 million, approximately 25% lower than initial guidance [11] - The company ended 2025 with approximately $3.0 billion in net debt and liquidity of about $342 million [12][32] Production and Operations - Total net production for Q4 2025 averaged approximately 67,900 barrels of oil equivalent per day (boepd), a 4% increase from Q3 2025 [5][14] - Jubilee production exceeded 70,000 bopd, with expectations for a 15% year-on-year growth in 2026 [4][22] - The Greater Tortue Ahmeyim (GTA) project produced around 2.9 million tonnes per annum (mtpa) year-to-date in 2026 [4][17] Reserves and Asset Management - At year-end 2025, Kosmos reported 1P reserves of approximately 250 million barrels of oil equivalent (mmboe) and 2P reserves of about 500 mmboe [13][26] - The company completed a sale of its interest in the Ceiba Field and Okume Complex for up to $220 million, enhancing liquidity and accelerating debt reduction [30] Cost Management - The company plans to reduce operating costs by around 20% year-on-year in 2026 [6][18] - The acquisition of the TEN FPSO is expected to significantly lower operating expenses [24] Strategic Initiatives - Kosmos has raised $600 million in new capital to reduce near-term bond maturities and enhance liquidity [7] - The company is focused on long-term value creation through production growth and maximizing cash flow for debt repayment [8]