Kosmos Energy Successfully Completes Reserve Based Lending Facility Amendment and Extension

Kosmos Energy (NYSE/LSE: KOS) (“Kosmos” or the “Company”) announced today that it has successfully completed the amendment and extension of its reserve based lending (“RBL”) facility.

As part of the amendment, Kosmos elected to lower the overall facility size from $1.5 billion to $1.25 billion to reduce reliance on the RBL facility and commitment costs following the successful completion of the Company’s senior notes issuance in February 2021. The amendment includes a two-year tenor extension, with the RBL facility’s final maturity now in March 2027.

In conjunction with the spring re-determination, the Company’s lending syndicate approved a borrowing base capacity of $1.24 billion with current outstanding borrowings of $1.0 billion. The slight reduction in borrowing capacity includes the impact of a lower long-term oil price deck, agreed in March 2021 with the bank syndicate. Total commitments as of May 7, 2021 were $1.21 billion, with the Company expecting to increase total commitments to $1.25 billion in the second quarter of 2021 as additional lenders complete their final credit approval process. The margin increased by 50 basis points compared to the previous facility, reflecting the current banking market environment, with a margin of LIBOR +375 basis points within the first three years of the amended RBL facility.

In line with the Company’s focus on sustainability, the amendment includes a mechanism for two environmental, social and governance (“ESG”) key performance indicators (“KPIs”) to impact the margin based upon delivering emissions targets and achieving certain third party ESG ratings. The KPIs are expected to be agreed upon at the September 2021 redetermination.

The RBL facility is secured against the Company’s production assets in Ghana and Equatorial Guinea with the first amortization payment scheduled for March 2024. Kosmos’ gas assets in Mauritania and Senegal remain unencumbered.

“We are pleased to have successfully completed this RBL amendment and extension, and we thank our bank group for its continued support. Following the recent senior notes offering, Kosmos has increased liquidity and cleared any material debt maturities until late 2024. For the first time, we are incorporating ESG KPIs into our RBL framework, which will offer an economic incentive to maintain and further improve our strong ESG credentials. With two important financing transactions completed so far in 2021, the Company is well positioned to meet its strategic and financial objectives for the year,” said Neal Shah, Chief Financial Officer.