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Kosmos Energy (NYSE: KOS) reported first-quarter production at a company record, driven by the ramp-up of Greater Tortue Ahmeyim (GTA) and new wells at Jubilee, while management said the company is ahead of schedule on its 2026 debt-reduction plans.
Chairman and CEO Andy Inglis said Kosmos is making “excellent progress” against four 2026 objectives: growing production, reducing operating costs, cutting net debt, and advancing its growth portfolio with limited capital spending this year.
Compared with the same quarter last year, Inglis said production increased about 25%. He also said absolute operating costs fell about 22%, and net debt declined about 7% from year-end 2025.
CFO Neal Shah said quarterly production averaged a record 75,000 barrels of oil equivalent per day, supported by GTA ramp-up and new Jubilee wells.
Operating expense was just under $20 per BOE. Shah said this was down 47% year over year and aligned with company guidance. Management maintained full-year guidance.
For the second quarter, management expects production to be slightly lower than the first quarter due to seasonality at GTA and a Gulf of America well issue.
Inglis highlighted Kosmos’ exposure to premium international pricing benchmarks, saying the company is among the most exposed in the U.S. E&P sector to international prices as a percentage of sales.
He said about half of production, primarily from Ghana, is priced off Dated Brent. Inglis noted that Dated Brent reached an all-time high in early April and has continued to trade at a premium to Brent futures, while West African crude differentials moved from slightly negative early in the year to a “meaningful premium” as markets tightened.
However, Kosmos said it does not expect the full benefit of higher pricing to appear until the second and third quarters because of contract timing. Ghana cargoes are priced around loading windows, Gulf barrels are generally sold on a one-month trailing average, and GTA gas is priced on a three-month historical average tied to ICE Brent.
In Ghana, Inglis said the 2025-2026 Jubilee drilling campaign continues to perform strongly. He said the J74 well came online in early 2026 and J75 followed at the end of the quarter.
Gross Jubilee production averaged about 70,000 barrels of oil per day in the first quarter. Kosmos expects second-quarter Jubilee production in the mid-70,000-barrel-per-day range, with three new producer wells expected online in June and July.
Based on logging results, Inglis said the wells should add about 20,000 barrels per day gross in aggregate before natural decline later in the year as the drilling campaign concludes.
Management said year-to-date performance and upcoming activity support the upper end of Kosmos’ 2026 Jubilee guidance of 70,000 to 80,000 barrels per day gross oil production.
Inglis also said the Jubilee partnership is aligned on securing a rig for a program of up to 10 wells, with drilling targeted to restart around mid-2027. He added there is no scheduled Jubilee maintenance shutdown in 2026 or 2027.
At Greater Tortue Ahmeyim, Kosmos said the project produced at an equivalent rate of about 2.85 million tons per annum gross in the first quarter, above the floating LNG facility’s nameplate capacity of 2.7 million tons per annum.
The company said GTA lifted 9.5 gross LNG cargoes during the quarter, in line with guidance. Full-year gross cargo guidance remains 32 to 36 LNG cargoes.
Inglis said daily LNG production is expected to decline from higher winter levels as sea and air temperatures warm during the summer, then improve later in the year as cooler temperatures return.
Kosmos also said it remains on track to reduce GTA operating expense per MMBtu by 50% this year, with additional reductions possible in 2027.
On the GTA Phase 1 expansion, Inglis said roughly half of the land has been cleared for the onshore section of the northern pipeline segment in Senegal, with the remainder expected this quarter. The segment will connect to the 250-megawatt Gandon power station near Saint-Louis.
Kosmos said the West African Development Bank has been appointed mandated lead arranger for approximately $270 million of infrastructure financing, and its board approved a first tranche of about $90 million in late March.
In the Gulf of America business, Kosmos said first-quarter production was in line with expectations, supported by the Odd Job and Kodiak fields.
It said the Winterfell-2 well was shut in during April pending a future intervention, and Kosmos now expects full-year Gulf production toward the lower end of its guidance.
Kosmos and 50-50 partner Oxy reached a final investment decision on the Kosmos-operated Tiberius project. Inglis described the first phase—a single-well tieback to Oxy’s Lucius platform—as a low-cost, high-margin development, with expected development costs of about $10 per barrel and operating and transport costs of about $20 per barrel.
Capital spending is expected mainly in 2027 and 2028, with first oil targeted for the second half of 2028.
Kosmos said it has started a farm-out process to reduce its working interest to around one-third, adding that Inglis said there has been “significant interest” in the opportunity.
The company also highlighted a strategic exploration alliance with Shell in the Gulf of Mexico. Kosmos expects the first prospect, Trailblazer, to be drilled in the first half of 2027, targeting about 200 million barrels of oil equivalent of gross resource.
Shah said Kosmos completed several financing actions early in the year. In January, the company issued a $350 million Nordic bond and used proceeds to repurchase $250 million of 2027 notes and repay $100 million on its bank facility. In March, Kosmos raised about $200 million of equity, also used to accelerate debt reduction.
The company ended the quarter with about $500 million of liquidity. Shah said additional liquidity is expected from the pending sale of producing assets in Equatorial Guinea, expected to close around midyear, and from future free cash flow. Lending banks have approved the Equatorial Guinea sale, with proceeds slated to further reduce the facility.
Inglis said Kosmos is doubling its 2026 net debt reduction target from 10% to about 20% by year-end, citing the Equatorial Guinea sale, the equity raise, and higher pricing. Shah said the company continues to target leverage of about 1.5 times in a normalized oil-price environment and is focused on bringing net debt below $2 billion as a milestone.
Shah also noted that Fitch upgraded Kosmos’ corporate rating to B-, which he said reflected the company’s progress this year. Management said capital allocation remains unchanged despite stronger commodity prices, with free cash flow directed toward debt reduction while advancing select growth projects.
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