Kosmos Energy Seeks Buyers for Ghana Oil Assets


West Cape Three Points, Ghana
(Click to Enlarge)

LONDON (Dow Jones Newswires), Feb. 10, 2009

Kosmos Energy LLC is seeking buyers for its stakes in a huge West African oil field, two people familiar with the matter said, in the latest sign that tight credit markets and low oil prices are hurting smaller firms.

The possible divestment -- which has attracted the interest of large oil players -- also highlights the increasing consolidation in the sector. It could herald the majors' entry into Ghana, a West African nation set to become an oil producer next year.

Dallas-based, privately held Kosmos has appointed advisers to handle the sale of its stakes in two blocks that span the Jubilee oil field in Ghana, and they could fetch as much as $3 billion, one of the persons said.

Chevron Corp., ExxonMobil Corp., Italy's Eni SpA, India's Oil & Natural Gas Corp., and Cnooc Ltd. have expressed interest in the Ghana assets, the person added.

It comes at a time of tight credit markets which are making it harder for smaller oil producers to cover the cost of bringing new projects online, and prompting some to seek buyers for individual assets or the company as a whole.

Oil prices are down $100 a barrel from their peak in July last year, and aren't forecast to rebound any time soon, potentially forcing operators to delay production if they want to maximize returns.

"Our sense is that Kosmos doesn't really want to sell, but may feel it has no option given where oil prices are right now. It wants to know the valuation that the market is putting on the Jubilee asset," said an official at one of the companies considering a bid.

The Jubilee field is one of West Africa's biggest oil strikes in years, likely containing recoverable reserves of at least 1.2 billion barrels of oil equivalent, with first output scheduled for the second half of 2010.

Kosmos, which is backed by private-equity firms Warburg Pincus and Blackstone Group, operates the West Cape Three Points block with a 30.875% stake and has an 18% stake in the adjacent Deepwater Tano block. The Jubilee field straddles both blocks in the Gulf of Guinea.

The person said partners in the blocks, including Tullow Oil PLC and Anadarko Petroleum Corp., have the right to pre-empt any stake sale agreed by Kosmos.

Anadarko has already flagged its willingness to pre-empt a sale, the person added, although it will likely seek to bring in a new partner to the Jubilee field in exchange for them carrying much of its development costs.

A spokesman for Kosmos didn't return requests for comment.

Spokespeople for Eni, Chevron, ONGC, ExxonMobil and Anadarko declined to comment. A spokesman for Cnooc wasn't aware of any talks.  

Copyright (c) 2009 Dow Jones & Company, Inc.

Related Companies
 Company: Exxon Mobil Corporationmore info


 - ExxonMobil's $5.6B Acquisition Validates Permian as Core Operator Strategy (Jan 17)
 - Petrovietnam, Exxon Mobil Sign Deal On Gas Generation (Jan 13)
 - ExxonMobil Strikes More Oil Offshore Guyana (Jan 12)
 Company: Anadarko Petroleummore info
 - Anadarko To Sell Certain Marcellus Assets For $1.24B (Dec 21)
 - Mozambique Approves Changes To LNG Contracts With Anadarko, Eni (Dec 7)
 - More Company Climate Votes Ahead, As Trump May Loosen Energy Rules (Nov 25)
 Company: Chevron Corporationmore info
 - Argentina Clinches Deal to Attract Investment in Vaca Muerta Shale (Jan 11)
 - Oil, Gas Conflicts throughout Africa in 2016 (Jan 4)
 - SOCAR, AIOC Agree to Develop ACG Field (Dec 23)
 Company: ONGCmore info


 - What Will it Take for Operators to Invest in India? (Nov 1)
 - Undaunted by Gas Price Cut, ONGC Firm on $4.5 Billion CAPEX (Oct 6)
 - India ONGC To Invest $5.1B In 4 Years In East Coast Oil Gas Asset (Sep 30)
 Company: ENImore info


 - Oil, Gas Firms Make Global 100 Most Sustainable Corporations List (Jan 19)
 - Norway Awards 56 Oil And Gas Licences In Mature Areas (Jan 17)
 - Eni: Oil, Gas Discovery in Norwegian Sea (Jan 17)
 Company: Tullow Oilmore info
 - Tullow Finds Oil in Kenyan Erut-1 Well (Jan 17)
 - Tullow's Founder Heavey to Step Down as CEO (Jan 11)
 - Total's Uganda Expansion 'Significantly De-risks' Project Sanction (Jan 10)
 Company: CNOOCmore info
 - CNOOC to Drill 126 Exploration Wells in 2017 (Jan 19)
 - CNOOC Commences Production from Enping 23-1, South China Sea (Jan 18)
 - CNOOC Starts Penglai 19-9 Output (Jan 13)
 Company: Kosmos Energymore info
 - BP Enters Mauritania, Senegal with Kosmos (Dec 19)
 - Tullow Starts TEN Production Offshore Ghana (Aug 18)
 - Oil, Gas Companies Tighten Cash Flow at Expense of Future Growth (Jul 26)
Events  SUBSCRIBE TO OUR NEWSLETTER

Our Privacy Pledge
SUBSCRIBE


Most Popular Articles


From the Career Center
Jobs that may interest you
Attorney I
Expertise: Contracts Administration|Legal
Location: Houston, 
 
Project Engineer/Project Manager
Expertise: Project Management
Location: Baton Rouge, 
 
Community Relations Manager Job
Expertise: Legal|PR / Corporate Communications|Project Management
Location: Red Wing, MN
 
search for more jobs

Brent Crude Oil : $54.16/BBL 0.44%
Light Crude Oil : $51.37/BBL 0.56%
Natural Gas : $3.37/MMBtu 2.12%
Updated in last 24 hours