Kosmos Energy, a renowned upstream oil company, has reportedly announced the closing of its Gulf of Mexico facility with Trafigura Trading LLC and Beal Bank USA. The company has now restructured the previously announced prepayment facility in Gulf of Mexico into a $200 million five-year term-loan facility, which is secured against its Gulf of Mexico assets.
The $50 million advanced as part of a prepayment agreement that was inked with Trafigura in June has now been rolled into the company’s new facility, which is structured by CSG Investments, with the rest of the $150 million facilitated by Beal Bank.
The Gulf of Mexico facility, which holds a significant interest rate of about 6%, elevates the firm’s borrowing capacity by over $50 million from the primary prepayment agreement. It also extends the facility’s tenor to five years and also adds an accordion feature enabling the facility to be expanded by $300 million.
The Chief Financial Officer of Kosmos Energy, Neal Shah stated that the syndication and closing of this facility improves the strong liquidity position of the company with better access to flexible and low-cost financing.
Shah further added that in addition to the free cash generated by the company’s low-cost assets of production and proceeds from the firm’s recent transaction with Shell expected in this quarter, the balance sheet of Kosmos is anticipated to strengthen in 2021.
Since September 30, 2020, after the closing of the company’s Gulf of Mexico facility, it has about $650 million worth of liquidity available ahead of the fall RBL redetermination conclusion, which Kosmos expects to close soon.
Kosmos Energy is a renowned international deep-water oil and gas production and exploration firm, predominantly operating on the Atlantic Margins. The firm is listed on the London Stock Exchange and New York Stock Exchange, trading under the KOS ticker symbol.