Kosmos Energy to sell some exploration assets to Shell

Kosmos12.png Kosmos Energy says it has agreed to sell certain exploration assets in Africa

Wed, 23 Sep 2020 Source: goldstreetbusiness.com

Oil and gas producer Kosmos Energy says it has agreed to sell certain exploration assets in Africa and South America to a unit of Royal Dutch Shell for up to US$200 million.

Shell will acquire the company’s participating interest in blocks offshore São Tomé and Príncipe, Suriname, Namibia and South Africa, Kosmos said in a statement. This means the company’s exploration portfolio in Ghana will not be affected by the sale.

However it is likely that part of the sales proceeds will be used to fund its share of ongoing exploration costs in Ghana where it partners with a consortium of international firms to explore for oil in and around the Deepwater Tano block where it discovered the country’s first commercial find, which was subsequently developed into Ghana’s flagship Jubilee oil and gas field..

Kosmos said it plans to use up to one-third of the initial sale proceeds of US$100 million to test two high-quality infrastructure-led exploration prospects in the Gulf of Mexico.

The company is a highly successful explorer, and indeed prefers to sell most of its stake in its discoveries rather than hold large equity stakes in producing fields.

Instructively, about a decade ago it tried to sell its stake in the Jubilee field to Exxon Mobil, but the transaction was blocked by regulators in Ghana on the grounds of its involving proprietary data to attract the buyer.

Dallas, Texas-based Kosmos said it expects to realize about US$125 million in total savings across capital expenditures over the next two years after the sale to Shell.

Source: goldstreetbusiness.com
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