Page 14 - LatAmOil Week 50 2020

LatAmOil SURINAME LatAmOil

Kosmos Energy finalises sale of South

American and African assets to Shell

US-BASED Kosmos Energy reported last week a low-cost, lower-carbon development scheme,”
that it had finalised a farm-down deal involving it said. “The company expects to use the remain-
assets in South America and Africa with Royal der of the proceeds to reduce borrowings out-
Dutch Shell (UK/Netherlands). standing under its credit facilities.”
In a statement dated December 10, Kosmos Andrew Inglis, the chairman and CEO of
said it had closed the transaction with Dordtsche Kosmos, commented: “With this transaction,
Petroleum Maatschappij, a fully-owned subsid- we are continuing to focus our exploration
iary of Shell, in line with the terms of an agree- portfolio on proven basins that offer superior
ment signed in September. As a result, the Shell returns with shorter payback and significant
affiliate is now set to acquire all of the US compa- resource potential. The proceeds enable Kosmos
ny’s participating interests in blocks located off to accelerate high-graded exploration opportu-
the coast of Suriname, São Tomé and Príncipe nities while strengthening the balance sheet,
and Namibia. It will also take control of Kosmos’ positioning Kosmos to create additional share-
South African assets next year. holder value. The contingent payments locked
Kosmos has estimated the total value of into the agreement with Shell ensure we retain
the farm-down deal at nearly $200mn. In its upside from frontier exploration with no further
statement, it said that Dordtsche Petroleum investment.” ™
Maatschappij would pay “approximately
$95mn, plus future contingent payments of up
to $100mn,” for the assets involved.
The statement did not name the blocks slated
for transfer to the Shell subsidiary. According to
its website, Kosmos holds stakes in Blocks 5, 6,
10, 11, 12 and 13 offshore São Tomé & Príncipe;
in Block 39 offshore Namibia; in Northern Cape
Ultra-Deep Block offshore South Africa, and in
Blocks 42 and 45 offshore Suriname.
The company has reported previously that it
expects to drill exploration wells in three of the
four countries listed above in 2021. It did not say
last week how the farm-down would affect those
plans, but it did confirm that it still planned to
use the proceeds of the deal to reduce its debt
burden and fund exploration work in the US
Gulf of Mexico.
“Kosmos plans to use up to one third of the ini-
tial proceeds to test two high-quality infrastruc-
ture-led exploration prospects in the Gulf of
Mexico, each offering hub-scale potential with Kosmos has assets in Suriname and several African states (Image: Kosmos Energy)

BRAZIL
Brazilian Senate approves gas reform bill

BRAZIL’S new gas reform bill, which was The legislation has already passed in the
designed to further the process of opening the lower house of the National Assembly, with
domestic natural gas market up to private com- members of the Chamber of Deputies approv-
petition, has moved one step closer to passage. ing it in September.
According to press reports, members of the Once passed into law, the legislation would
Brazilian Senate endorsed the basic text of the help shatter the monopoly that state-controlled
bill last week. Petrobras has long held over the energy sector.

P14 www. NEWSBASE .com Week 50 17•December•2020