Kosmos Energy to start drilling three prospects off West Africa this month
Kosmos Energy, a company behind some of the industry’s largest recent oil discoveries, will begin drilling the first of a trio of so-called super-giant prospects off the coast of Senegal and Mauritania later this month.
The Dallas oil company plans to resume drilling operations soon off the coast of West Africa, where it has already drilled six wells and discovered some 40 trillion cubic feet of gas equivalent in recent years.
“Mauritania-Senegal is the largest new petroleum system opened along the last 15 years along the Atlantic margin,” said Andy Inglis, chairman and CEO of Kosmos, in a conference call with analysts and investors. New 3D seismic data “support our view that our discovered resource base will continue to grow as we continue to drill.”
The US oil producer represents a dying breed. While others put money in domestic shale plays and retreat from deep-water ventures, Kosmos is still betting heavily on the offshore exploration side of the oil business.
Kosmos posted a net loss of $8.5 million in the second quarter, still an improvement over the $108.3 million loss it had from April to June last year. Revenue climbed from $46 million to $136 million.
In recent months, onshore US oil producers have seen oil field service costs rise with the increase in drilling activity in places like West Texas and Oklahoma.
Kosmos, though, told investors it has seen costs continue to fall over the past year, with exploration expenses cut nearly in half to $20 million amid reduced costs for geologic and geophysical services – a side effect of the continued stagnation in offshore drilling.
It also reduced its capital spending budget from $150 million to $100 million, not because of falling oil prices, but because of lower than expected project costs in Ghana. Three quarters of its reduced budget will go to oil exploration, including seismic activity.