Call Start: 11:00 Call End: 11:48 Kosmos Energy Ltd (KOS) Q4 2011 Earnings Call March 1, 2012 11:00 a.m. ET Executives Brad Whitmarsh – Vice President, Investor Relations Brian Maxted – President and CEO Greg Dunlevy – Executive Vice President and CFO Paul Dailly – Senior Vice President of exploration. Darrell McKenna – Chief Operating Officer Analysts Edward Westlake – Credit Suisse Ryan Todd – Deutsche Bank Bob Morris – Citigroup Anish Kapadia – Tudor Pickering Holt & Co. Al Stanton – RBC Capital Markets Laura Loppacher – Jeffries & Co. Presentation Operator
Before we get started, I would like to mention that this conference call include certain forward-looking statements which are based on our current expectations. The risks associated with forward-looking statements have been outlined in the earnings release, and in our SEC filings.We may also refer to certain non-GAAP financial measures such as EBITDAX, or Earnings Before Interest, Taxes, DD&A and Exploration. The management believes these measures are important in looking at the company's historical and future performance, and these are commonly referred to metrics in our industry. Historical non-GAAP performances reconciled to the directly comparable GAAP measure in our earnings release. These measures are provided in addition to not as an alternative for and should be read in conjunction with the information contained in our financial statements prepared in accordance with GAAP. At this time, I'd like to turn the call over to Brian. Brian Maxted Thanks Brad, and good morning everyone. In today’s call I want to first comment on 2011, a year of significant accomplishment for Kosmos, and then secondly folks on our strategic goals and plans for 2012. Greg will follow with a discussion about fourth quarter results and then provide an overview of our 2012 capital program. 2011 was a big year for our company. It was a year of meaningful transformations for Kosmos in many ways. Obviously one of our largest accomplishments was becoming a public traded company in May of last year. We also began a significant transition of the organization, largely driven by our exploration development success. We made a lot of progress with this initiative over the last year. In this context it’s a great pleasure to have John McKenna, our Chief Operating Officer with us on the call today. Darrell joined Kosmos earlier this year, and he is responsible for leading our operations, production and development teams as well as [indiscernible] and procurement. His background and significant expertise in development of oil and gas resources are a great fit for Kosmos particularly at a time when we are facing significant growth and capital investments in ongoing major projects.
Paul will wrap up the operating discussion with a review of our substantial exploration and appraisal drilling program in 2012, as one of the ongoing build of the exploration portfolio. We’re intrinsically a biggie company with plans to grow organically through exploration success. Our highest priority is to find new [indiscernible] systems of size with a focus on frontier emerging basins. To that end we had a number of strategic opportunities in the portfolio last year providing Kosmos with exposure to multi billion barrel hydrocarbon discoveries.It was a year of outstanding results in our exploration appraisal programs in 2011 as we continue to maximize the value of the petroleum system we opened in the Tano Basin, offshore Ghana. We announced four new discoveries making 2011 the second best exploration year in the company’s history. In addition we apprised a number of our existing fields progressing several towards major plans for development. We bought production and cash flows on stream from massive Jubilee field lifting nearly 6 million barrels of crude net to us in 2011, and generating significant revenues for the company. The Jubilee reservoir is performing very well and information to-date confirms field wide pressure support suggesting confidence on ultimate recovery. Looking back our phased development approach was the first right step for Jubilee bringing cash flows online quickly and allowing us to get early production earnings. Our 2012 goals for Jubilee are threefold. First, we’re focused on further gaining reservoir and production information. Second, we will be evaluating production enhancement options for Phase 1. Third, will be executing on the next phase of development in the field, Phase 1A. We are making good progress towards optimizing well drilling and completion design in support of full field development. This is a world class field and what we’ve learnt today will prove beneficial to the remaining phases of Jubilee and for the developments in Ghana. Read the rest of this transcript for free on seekingalpha.com