Kosmos Energy — Third Quarter 2026 Earnings Summary

Financial Performance:

• Reported a net loss of $43 million ($0.07 per diluted share) for the quarter, compared to a net loss of $124 million ($0.26 per share) in Q3 2025.
• Reported adjusted net income of $35 million ($0.06 per diluted share), compared to an adjusted net loss of $72 million ($0.15 per share) in Q3 2025.
• Generated revenues of $410 million ($71.39 per boe excluding derivative cash settlements), up from $311 million in Q3 2025.
• Production expenses totaled $102 million ($17.72 per boe), a ~31% reduction in absolute expenses compared to Q3 2025 ($147.7 million).
• Net cash provided by operating activities was approximately $164 million, compared to a net cash used of $27.6 million in Q3 2025.
• Free cash flow was approximately $90 million for the quarter, compared to a negative $98.9 million in Q3 2025; year-to-date free cash flow is $193 million.
• Exited the quarter with net debt of approximately $2.47 billion, down from $2.98 billion at year-end 2025.
• Held approximately $570 million in liquidity at quarter-end.
• Full-year 2026 capital expenditure guidance remains unchanged at approximately $350 million.

Guidance and Future Outlook:

• On track to achieve a ~20% net debt reduction target for 2026, with year-end net debt expected below $2.4 billion and leverage falling toward 2.0x.
• Q4 2026 production guidance is 60,000–64,000 boepd.
• Q4 2026 operating expense (Opex) guidance is $18.00–$20.00 per boe.
• Q4 2026 DD&A guidance is $17.50–$19.50 per boe.
• Q4 2026 G&A guidance is $10–$15 million.
• Q4 2026 exploration expense guidance is approximately $5 million.
• Q4 2026 net interest expense guidance is $50–$55 million.
• Q4 2026 tax guidance is $11.00–$15.00 per boe.
• Q4 2026 capital expenditure guidance is $50–$75 million.
• Full-year gross LNG cargo liftings for Mauritania and Senegal are expected at the upper end of the 32–36 guidance range.
• The 2027/28 drilling program for Jubilee is expected to start in mid-2027 with up to 10 wells.
• Drilling for the Trailblazer exploration well is expected to commence in the first half of 2027.

Business Segments and Product Lines:

• Total net production averaged ~69,200 boepd in Q3 2026, up ~6% versus Q3 2025 (~17% excluding Equatorial Guinea).
• Ghana production averaged ~40,500 boepd, including ~6,800 boepd of gas; 2.75 Jubilee cargo liftings occurred in the quarter.
• Jubilee field oil production averaged ~84,500 bopd gross, up ~17% from Q2 2026, following the completion of a seven-well drilling campaign.
• TEN field oil production averaged ~14,600 bopd gross, in line with expectations; FPSO ownership and operational transition is scheduled for Q1 2027.
• Greater Tortue Ahmeyim (GTA) production averaged ~14,600 boepd net; 8.5 gross LNG cargos were lifted in the quarter.
• Gulf of America production averaged ~14,100 boepd net (~83% oil); Q4 2026 production is expected to be impacted by planned maintenance and Hurricane Isaias.
• Completed the Tiberius farm-down, securing a mix of upfront cash, carry for future capital expenditure, and milestone payments; Navitas became a 33.33% partner.
• Completed the amendment and extension of the $1.2 billion reserve-based lending (RBL) facility, extending the final maturity to April 2033.

Market and Competitive Landscape:

• The company secured the Noble Faye Kozack rig for the 2027/28 Jubilee drilling program.
• The partnership for the GTA project secured the third gross condensate cargo of the year in early Q4 2026.
• Réseau Gazier du Sénégal reported the Northern Segment of the onshore pipeline is over 25% complete as of October 2026.
• Kosmos added further hedges for 2027, securing 8 million barrels of oil with an average floor of ~$68/barrel and ceiling of ~$84/barrel.

Risks and Challenges:

• Q4 2026 production is expected to be impacted by planned Delta House platform maintenance, a workover on the Kodiak-1 well, and downtime associated with Hurricane Isaias.
• Timing of the third gross condensate cargo lift was slightly impacted by weather.
• Forward-looking statements are subject to risks and uncertainties including assumptions about future events, market conditions, and operational execution.

Management Commentary and Tone:

• Chairman and CEO Andrew G. Inglis stated the company made meaningful progress against four objectives: increase production, lower costs, reduce debt, and advance quality growth opportunities.
• Management highlighted strong operational execution, reduced costs, disciplined capital allocation, and proactive financing as drivers for strengthening the business.
• The company noted continued quality of infill opportunities at Jubilee and solid reservoir performance at GTA.
• Management expressed confidence in entering 2027 in a much stronger position with multiple catalysts across the portfolio.

Other Key Points:

• Sold assets in Equatorial Guinea (Ceiba Field and Okume Complex) to Panoro Energy ASA on June 16, 2026, resulting in a gain on sale of assets of $9.1 million for the nine months ended September 30, 2026.
• Net debt reduction of over $500 million was achieved through the end of the third quarter.
• The company delivered three consecutive quarters of positive free cash flow.
• Kosmos exited the quarter in a net underlift position of approximately 1.1 mmboe.
• The RBL facility has $750 million currently drawn with no planned amortization payments until 2031.
• The Trailblazer project (~200 mmboe gross resource) is the first exploration well drilled through the exploration alliance with Shell.