Kosmos Energy(US:KOS)2023-11-06 21:04Financial Data and Key Metrics Changes - The operator forecasts that Jubilee will produce around 85,000 barrels of oil per day gross for 2023, down from the previous estimate of 90,000 barrels, leading to lower production guidance for the year [1] - Net production for the quarter was approximately 68,000 barrels of oil equivalent per day, an increase of about 17% from the previous quarter [55] - Full year 2023 production guidance is now expected to be approximately 63,000 barrels of oil equivalent per day due to delayed start-up of Jubilee Southeast and reduced water injection levels [94] Business Line Data and Key Metrics Changes - Jubilee produced an average of around 96,000 barrels of oil per day gross during the quarter, an increase of over 30% compared to the previous quarter [55] - The Gulf of Mexico net production was approximately 15,700 barrels of oil equivalent per day, ahead of guidance due to lower-than-anticipated storm activity [57] - Production from TEN was around 15,000 barrels of oil per day, in line with expectations but lower than the previous quarter due to a planned two-week shutdown [37] Market Data and Key Metrics Changes - The Yakaar Teranga field in Senegal is a world-scale gas resource with approximately 25 trillion cubic feet of gas in place, representing a significant opportunity for the company [2] - The company expects to prioritize cost-competitive gas to Senegal's rapidly growing domestic market while targeting exports into international markets [42] Company Strategy and Development Direction - The company is focused on executing a differentiated set of projects that are aimed at low-cost, lower-carbon oil and gas opportunities [33] - The management team is excited about the future opportunity set and aims to prioritize debt pay-down until reaching the target leverage level before considering shareholder returns [7] - The company plans to balance the pace and working interests of future projects to manage growth and generate material pre-cash flow [36] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in bringing new projects online and optimizing overall field performance but expressed excitement about the future potential of Jubilee [41] - The company is optimistic about the growth trajectory, expecting a material step-up in pre-cash flow as projects are delivered [36] - Management noted that the energy transition is influencing investment strategies and creating opportunities for the company [15] Other Important Information - The company anticipates a couple of quarters of higher capital expenditures ahead, particularly for completing Tortue and Winterfell, after which debt reduction is expected to accelerate [5] - The partnership is making good progress on the Winterfell project, with first oil on track for the end of the first quarter of 2024 [39] Q&A Session Summary Question: Can you provide clarity on Tortue CapEx and its phasing? - Management indicated that there would be a rephasing of CapEx due to subsea work, with some capital slipping into 2024 [10] Question: What is the status of the Yakaar Teranga project? - Management confirmed that Yakaar Teranga is a strategic project with a focus on providing affordable and cleaner energy for Senegal, and they are working on partnership strategies [91] Question: How does the company view the development of Tiberius? - Management expressed encouragement regarding the initial exploration well at Tiberius, indicating that they have de-risked a significant portion of the potential [69] Question: What is the company's approach to the Ghana tax situation? - Management clarified that there are no ongoing disputes with the Ghanaian Tax Authority and that discussions are ongoing without any formal claims [119][126]