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(Alliance News) - Kosmos Energy Ltd said Wednesday it has agreed to sell liquefied natural gas from phase one of the Greater Tortue Ahmeyim project, offshore Mauritania, to BP Gas Marketing Ltd, a subsidiary of oil major BP PLC.
The agreement is for BP Gas to take 2.45 million tonnes per year of LNG over an initial term of 20 years.
Following the agreement, Kosmos expects to book an additional net proved reserves of 100 million barrels of oil equivalent associated with phase one, as evaluated by its reserve auditor Ryder Scott Co LP.
The oil & gas firm expects to book additional reserves once further phases of the Tortue project are sanctioned, and more agreements are signed.
BP and Kosmos are partners on the Greater Tortue project, alongside National Oil Cos Petrosen and the Societe Mauritanienne des Hydrocarbures.
Also on Wednesday, Kosmos reported that its total proved reserves at the end of 2019, prior to the Tortue agreement, was 169 million boe, up from 167 million the same date a year before. Proved and probable reserves were increased over the year to 552 million boe from 513 million.
Including the 100 million boe in proved reserves to be booked following the agreement with BP, Kosmos's total probable reserves to date stands at 268 million boe.
Kosmos attributed the reserves increase to a strong performance in Ghana, mainly the Jubilee field, where additional drilling increased oil in place estimates.
"The quality of our diverse portfolio was demonstrated again in 2019 as Kosmos organically replaced approximately 106% of production on a 1P basis, marking the seventh consecutive year of greater than 100% of production replacement," said Chair and CEO Andrew Inglis.
"In addition, we reached another milestone in the Greater Tortue Ahmeyim development with the signing of the phase one SPA with BP Gas Marketing, enabling Kosmos to book our 1P reserves for the project. With a 1P reserve base of 268 mmboe, split approximately 60% oil, 40% gas, we have a 1P reserve to production ratio of approximately 11 years, supporting growth with an increasing contribution of gas," Inglis added.
Shares in Kosmos Energy - which is based in Dallas, Texas - were untraded on Wednesday, last quoted at 403.14 pence in London. BP shares were up 0.3% at 471.29p.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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