Document_and_Entity_Informatio
Document and Entity Information | 6 Months Ended | |
Jun. 30, 2014 | Jul. 28, 2014 | |
Document and Entity Information | ' | ' |
Entity Registrant Name | 'Kosmos Energy Ltd. | ' |
Entity Central Index Key | '0001509991 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Jun-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 386,830,220 |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q2 | ' |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $621,631 | $598,108 |
Restricted cash | 19,552 | 21,475 |
Receivables: | ' | ' |
Joint interest billings | 33,324 | 19,930 |
Oil sales | 115,987 | 281 |
Other | 7,646 | 1,115 |
Inventories | 39,839 | 47,424 |
Prepaid expenses and other | 51,706 | 27,010 |
Current deferred tax assets | 15,864 | 19,618 |
Total current assets | 905,549 | 734,961 |
Property and equipment: | ' | ' |
Oil and gas properties, net | 1,551,427 | 1,508,062 |
Other property, net | 12,977 | 14,900 |
Property and equipment, net | 1,564,404 | 1,522,962 |
Other assets: | ' | ' |
Restricted cash | 35,250 | 31,500 |
Deferred financing costs, net of accumulated amortization of $28,186 and $24,976 at June 30, 2014 and December 31, 2013, respectively | 52,692 | 40,111 |
Long-term deferred tax assets | 20,161 | 16,292 |
Total assets | 2,578,056 | 2,345,826 |
Current liabilities: | ' | ' |
Accounts payable | 88,728 | 94,172 |
Accrued liabilities | 216,830 | 115,212 |
Derivatives | 21,380 | 9,940 |
Total current liabilities | 326,938 | 219,324 |
Long-term liabilities: | ' | ' |
Long-term debt | 800,000 | 900,000 |
Derivatives | 13,973 | 3,811 |
Asset retirement obligations | 41,731 | 39,596 |
Deferred tax liability | 224,767 | 170,226 |
Other long-term liabilities | 17,689 | 20,534 |
Total long-term liabilities | 1,098,160 | 1,134,167 |
Shareholders' equity: | ' | ' |
Preference shares, $0.01 par value; 200,000,000 authorized shares; zero issued at June 30, 2014 and December 31, 2013 | ' | ' |
Common shares, $0.01 par value; 2,000,000,000 authorized shares; 392,285,186 and 391,974,287 issued at June 30, 2014 and December 31, 2013, respectively | 3,923 | 3,920 |
Additional paid-in capital | 1,821,468 | 1,781,535 |
Accumulated deficit | -642,744 | -774,220 |
Accumulated other comprehensive income | 1,347 | 2,158 |
Treasury stock, at cost, 5,490,138 and 4,400,135 shares at June 30, 2014 and December 31, 2013, respectively | -31,036 | -21,058 |
Total shareholders' equity | 1,152,958 | 992,335 |
Total liabilities and shareholders' equity | $2,578,056 | $2,345,826 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
CONSOLIDATED BALANCE SHEETS | ' | ' |
Deferred financing costs, accumulated amortization (in dollars) | $28,186 | $24,976 |
Preference shares, par value (in dollars per share) | $0.01 | $0.01 |
Preference shares, authorized shares | 200,000,000 | 200,000,000 |
Preference shares, issued shares | 0 | 0 |
Common shares, par value (in dollars per share) | $0.01 | $0.01 |
Common shares, authorized shares | 2,000,000,000 | 2,000,000,000 |
Common shares, issued shares | 392,285,186 | 391,974,287 |
Treasury stock, shares | 5,490,138 | 4,400,135 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Revenues and other income: | ' | ' | ' | ' |
Oil and gas revenue | $328,297 | $193,413 | $541,150 | $421,479 |
Gain on sale of assets | ' | ' | 23,769 | ' |
Interest income | 196 | 44 | 254 | 114 |
Other income | 869 | 321 | 1,308 | 575 |
Total revenues and other income | 329,362 | 193,778 | 566,481 | 422,168 |
Costs and expenses: | ' | ' | ' | ' |
Oil and gas production | 22,946 | 22,674 | 39,269 | 47,075 |
Exploration expenses | 23,509 | 94,522 | 36,318 | 118,777 |
General and administrative | 32,480 | 41,639 | 59,893 | 80,710 |
Depletion and depreciation | 69,546 | 58,562 | 115,924 | 117,211 |
Amortization-deferred financing costs | 2,559 | 2,785 | 5,345 | 5,483 |
Interest expense | 7,635 | 10,017 | 11,146 | 19,008 |
Derivatives, net | 21,566 | -12,707 | 19,538 | -7,199 |
Restructuring charges | 11,804 | ' | 11,804 | ' |
Loss on extinguishment of debt | ' | ' | 2,898 | ' |
Other expenses, net | 26 | 849 | 1,303 | 1,481 |
Total costs and expenses | 192,071 | 218,341 | 303,438 | 382,546 |
Income (loss) before income taxes | 137,291 | -24,563 | 263,043 | 39,622 |
Income tax expense | 80,784 | 46,253 | 131,567 | 90,344 |
Net income (loss) | $56,507 | ($70,816) | $131,476 | ($50,722) |
Net income (loss) per share | ' | ' | ' | ' |
Basic (in dollars per share) | $0.15 | ($0.19) | $0.34 | ($0.13) |
Diluted (in dollars per share) | $0.15 | ($0.19) | $0.34 | ($0.13) |
Weighted average number of shares used to compute net income (loss) per share: | ' | ' | ' | ' |
Basic (in shares) | 378,820 | 376,563 | 378,327 | 375,927 |
Diluted (in shares) | 381,818 | 376,563 | 381,157 | 375,927 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ' | ' | ' | ' |
Net income | $56,507 | ($70,816) | $131,476 | ($50,722) |
Other comprehensive income (loss): | ' | ' | ' | ' |
Reclassification adjustments for gains on cash flow hedges included in net income (loss) | -405 | -358 | -811 | -717 |
Other comprehensive income | -405 | -358 | -811 | -717 |
Comprehensive income (loss) | $56,102 | ($71,174) | $130,665 | ($51,439) |
CONSOLIDATED_STATEMENTS_OF_SHA
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (USD $) | Common Shares | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income | Treasury Stock | Total |
In Thousands, unless otherwise specified | ||||||
Balance at Dec. 31, 2013 | $3,920 | $1,781,535 | ($774,220) | $2,158 | ($21,058) | $992,335 |
Balance (in shares) at Dec. 31, 2013 | 391,974 | ' | ' | ' | ' | ' |
Increase (Decrease) in Shareholders' Equity | ' | ' | ' | ' | ' | ' |
Equity-based compensation | ' | 40,898 | ' | ' | ' | 40,898 |
Derivatives, net | ' | ' | ' | -811 | ' | -811 |
Restricted stock awards and units | 3 | -3 | ' | ' | ' | ' |
Restricted stock awards and units (in shares) | 311 | ' | ' | ' | ' | ' |
Restricted stock forfeitures | ' | 1 | ' | ' | -1 | ' |
Purchase of treasury stock | ' | -963 | ' | ' | -9,977 | -10,940 |
Net income | ' | ' | 131,476 | ' | ' | 131,476 |
Balance at Jun. 30, 2014 | $3,923 | $1,821,468 | ($642,744) | $1,347 | ($31,036) | $1,152,958 |
Balance (in shares) at Jun. 30, 2014 | 392,285 | ' | ' | ' | ' | ' |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 |
Operating activities | ' | ' |
Net income (loss) | $131,476 | ($50,722) |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depletion, depreciation and amortization | 121,269 | 122,694 |
Deferred income taxes | 55,817 | 52,646 |
Unsuccessful well costs | 2,815 | 85,668 |
Change in fair value of derivatives | 22,301 | -3,302 |
Cash settlements on derivatives | -1,510 | -15,144 |
Equity-based compensation | 40,898 | 37,000 |
Gain on sale of assets | -23,769 | ' |
Loss on extinguishment of debt | 2,898 | ' |
Other | -4,132 | 2,827 |
Changes in assets and liabilities: | ' | ' |
(Increase) decrease in receivables | -135,631 | 88,092 |
(Increase) decrease in inventories | 7,519 | -11,927 |
Increase in prepaid expenses and other | -24,696 | -3,939 |
Decrease in accounts payable | -5,444 | -64,900 |
Increase in accrued liabilities | 96,250 | 37,877 |
Net cash provided by operating activities | 286,061 | 276,870 |
Investing activities | ' | ' |
Oil and gas assets | -186,463 | -166,581 |
Other property | -914 | -3,278 |
Proceeds on sale of assets | 58,315 | ' |
Restricted cash | -1,827 | 1,965 |
Net cash used in investing activities | -130,889 | -167,894 |
Financing activities | ' | ' |
Payments on long-term debt | -100,000 | -100,000 |
Purchase of treasury stock | -10,940 | -13,041 |
Deferred financing costs | -20,709 | -2,225 |
Net cash used in financing activities | -131,649 | -115,266 |
Net increase (decrease) in cash and cash equivalents | 23,523 | -6,290 |
Cash and cash equivalents at beginning of period | 598,108 | 515,164 |
Cash and cash equivalents at end of period | 621,631 | 508,874 |
Cash paid for: | ' | ' |
Interest | 15,302 | 17,198 |
Income taxes | $44,367 | $28,722 |
Organization
Organization | 6 Months Ended |
Jun. 30, 2014 | |
Organization | ' |
Organization | ' |
1. Organization | |
Kosmos Energy Ltd. was incorporated pursuant to the laws of Bermuda in January 2011 to become a holding company for Kosmos Energy Holdings. Kosmos Energy Holdings is a privately held Cayman Islands company that was formed in March 2004. As a holding company, Kosmos Energy Ltd.’s management operations are conducted through a wholly owned subsidiary, Kosmos Energy, LLC. The terms “Kosmos,” the “Company,” “we,” “us,” “our,” “ours,” and similar terms refer to Kosmos Energy Ltd. and its wholly owned subsidiaries, unless the context indicates otherwise. | |
We are a leading independent oil and gas exploration and production company focused on frontier and emerging areas along the Atlantic Margin. Our assets include existing production and other major development projects offshore Ghana, as well as exploration licenses with significant hydrocarbon potential offshore Ireland, Mauritania, Morocco (including Western Sahara) and Suriname. Kosmos is listed on the New York Stock Exchange and is traded under the ticker symbol KOS. | |
We have one reportable segment, which is the exploration and production of oil and natural gas. Substantially all of our long-lived assets and product sales are currently related to production located offshore Ghana. | |
Accounting_Policies
Accounting Policies | 6 Months Ended |
Jun. 30, 2014 | |
Accounting Policies | ' |
Accounting Policies | ' |
2. Accounting Policies | |
General | |
The interim-period financial information presented in the consolidated financial statements included in this report is unaudited and, in the opinion of management, includes all adjustments of a normal recurring nature necessary to present fairly the consolidated financial position as of June 30, 2014, the changes in the consolidated statements of shareholders’ equity for the six months ended June 30, 2014, the consolidated results of operations for the three and six months ended June 30, 2014 and 2013, and consolidated cash flows for the six months ended June 30, 2014 and 2013. The results of the interim periods shown in this report are not necessarily indicative of the final results to be expected for the full year. The consolidated financial statements were prepared in accordance with the requirements of the Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain notes or other financial information that are normally required by Generally Accepted Accounting Principles in the United States of America (“GAAP”) have been condensed or omitted from these interim consolidated financial statements. These consolidated financial statements and the accompanying notes should be read in conjunction with our audited consolidated financial statements for the year ended December 31, 2013, included in our annual report on Form 10-K. | |
Reclassifications | |
Certain prior period amounts have been reclassified to conform with the current year presentation. Such reclassifications had no impact on our reported net loss, current assets, total assets, current liabilities, total liabilities or shareholders’ equity. | |
Restricted Cash | |
In accordance with our commercial debt facility, we are required to maintain a restricted cash balance that is sufficient to meet the payment of interest and fees for the next six-month period. As of June 30, 2014 and December 31, 2013, we had $18.6 million and $18.6 million, respectively, in current restricted cash to meet this requirement. In addition, in accordance with certain of our petroleum contracts, we have posted letters of credit related to performance guarantees for our minimum work obligations. These letters of credit are cash collateralized in accounts held by us and as such are classified as restricted cash. Upon completion of the minimum work obligations and/or entering into the next phase of the petroleum contract, the requirement to post the existing letters of credit will be satisfied and the cash collateral will be released. However, additional letters of credit may be required should we choose to move into the next phase of certain of our petroleum contracts. As of June 30, 2014 and December 31, 2013, we had $1.0 million and $2.9 million, respectively, of current restricted cash and $35.3 million and $31.5 million, respectively, of long-term restricted cash used to cash collateralize performance guarantees related to our petroleum contracts. | |
Inventories | |
Inventories consisted of $39.8 million and $45.8 million of materials and supplies and nil and $1.6 million of hydrocarbons as of June 30, 2014 and December 31, 2013, respectively. The Company’s materials and supplies inventory primarily consists of casing and wellheads and is stated at the lower of cost, using the weighted average cost method, or market. | |
Hydrocarbon inventory is carried at the lower of cost, using the weighted average cost method, or market. Hydrocarbon inventory costs include expenditures and other charges incurred in bringing the inventory to its existing condition. Selling expenses and general and administrative expenses are reported as period costs and excluded from inventory costs. | |
Variable Interest Entity | |
Our wholly owned subsidiary, Kosmos Energy Finance International, is a variable interest entity (“VIE”). The Company is the primary beneficiary of this VIE, which is consolidated in these financial statements. | |
The following assets and liabilities of Kosmos Energy Finance International are shown separately on the face of the consolidated balance sheets as of June 30, 2014 and December 31, 2013: long-term debt and long-term derivatives liabilities. At June 30, 2014, Kosmos Energy Finance International had $38.6 million in cash and cash equivalents; $18.6 million in current restricted cash; $48.2 million deferred financing costs, net; $0.9 million in accounts payable; $0.1 million in accrued liabilities; $18.0 million in current derivatives and $4.4 million in other long-term liabilities, which are included in the amounts shown on the face of the consolidated balance sheets. At December 31, 2013, Kosmos Energy Finance International had $38.1 million in cash and cash equivalents; $18.6 million in current restricted cash; $0.2 million in prepaid expenses and other; $34.2 million deferred financing costs, net; $1.4 million in accrued liabilities; $9.9 million in current derivatives and $8.2 million in other long-term liabilities, which are included in the amounts shown on the face of the consolidated balance sheets. | |
Restructuring Charges | |
The Company accounts for restructuring charges in accordance with ASC 420-Exit or Disposal Cost Obligations. Under these standards, the costs associated with restructuring charges are recorded during the period in which the liability is incurred. During the three months and six months ended June 30, 2014, we recognized $11.8 million in restructuring charges for employee severance and related benefit costs incurred as part of a corporate reorganization, which includes $5.0 million of accelerated non-cash expense related to awards previously granted under our Long-Term Incentive Plan (the “LTIP”). | |
Property_and_Equipment
Property and Equipment | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Property and Equipment | ' | |||||||
Property and Equipment | ' | |||||||
3. Property and Equipment | ||||||||
Property and equipment is stated at cost and consisted of the following: | ||||||||
June 30, | December 31, | |||||||
2014 | 2013 | |||||||
(In thousands) | ||||||||
Oil and gas properties: | ||||||||
Proved properties | $ | 837,519 | $ | 801,348 | ||||
Unproved properties | 628,688 | 524,257 | ||||||
Support equipment and facilities | 724,238 | 710,289 | ||||||
Total oil and gas properties | 2,190,445 | 2,035,894 | ||||||
Less: accumulated depletion | (639,018 | ) | (527,832 | ) | ||||
Oil and gas properties, net | 1,551,427 | 1,508,062 | ||||||
Other property | 32,273 | 31,658 | ||||||
Less: accumulated depreciation | (19,296 | ) | (16,758 | ) | ||||
Other property, net | 12,977 | 14,900 | ||||||
Property and equipment, net | $ | 1,564,404 | $ | 1,522,962 | ||||
We recorded depletion expense of $67.2 million and $56.4 million for the three months ended June 30, 2014 and 2013, respectively and $111.2 million and $113.1 million for the six months ended June 30, 2014 and 2013, respectively. | ||||||||
In the first quarter of 2014, the Moroccan government issued a joint ministerial order approving a partial sale of our participating interests to BP Exploration (Morocco) Limited, a wholly owned subsidiary of BP plc (“BP”), covering our three blocks in the Agadir Basin, offshore Morocco. Upon receipt of this order, we closed the partial sale with BP. Certain governmental administrative processes required to officially reflect the transactions under Moroccan law are expected to be completed in due course. Under the terms of the agreements, BP acquired a non-operating interest in each of the Essaouira Offshore, Foum Assaka Offshore and Tarhazoute Offshore blocks. The sales price of the farm-outs was $56.9 million. All proceeds have been received as of June 30, 2014. After giving effect to these farm-outs, our participating interests are 30.0%, 29.925% and 30.0% in the Essaouira Offshore, Foum Assaka Offshore and Tarhazoute Offshore blocks, respectively, and we remain the operator. The proceeds on the sale of the interests exceeded our book basis in the assets, resulting in a $23.8 million gain on the transaction. | ||||||||
Suspended_Well_Costs
Suspended Well Costs | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Suspended Well Costs | ' | |||||||
Suspended Well Costs | ' | |||||||
4. Suspended Well Costs | ||||||||
The following table reflects the Company’s capitalized exploratory well costs on completed wells as of and during the six months ended June 30, 2014. The table excludes $2.8 million in costs that were capitalized and subsequently expensed during the same period. | ||||||||
Six Months | ||||||||
Ended | ||||||||
June 30, | ||||||||
2014 | ||||||||
(In thousands) | ||||||||
Beginning balance | $ | 376,166 | ||||||
Additions to capitalized exploratory well costs pending the determination of proved reserves | 46,265 | |||||||
Reclassification due to determination of proved reserves | — | |||||||
Capitalized exploratory well costs charged to expense | — | |||||||
Ending balance | $ | 422,431 | ||||||
The following table provides an aging of capitalized exploratory well costs based on the date drilling was completed and the number of projects for which exploratory well costs have been capitalized for more than one year since the completion of drilling: | ||||||||
June 30, 2014 | December 31, 2013 | |||||||
(In thousands, except well counts) | ||||||||
Exploratory well costs capitalized for a period of one year or less | $ | 45,638 | $ | 11,426 | ||||
Exploratory well costs capitalized for a period of one to two years | 171,871 | 229,140 | ||||||
Exploratory well costs capitalized for a period of three to five years | 204,922 | 135,600 | ||||||
Ending balance | $ | 422,431 | $ | 376,166 | ||||
Number of projects that have exploratory well costs that have been capitalized for a period greater than one year | 8 | 8 | ||||||
As of June 30, 2014, the projects with exploratory well costs capitalized for more than one year since the completion of drilling are related to the Mahogany, Teak-1, Teak-2 and Akasa discoveries in the West Cape Three Points (“WCTP”) Block and the Tweneboa, Enyenra, Ntomme and Wawa discoveries in the Deepwater Tano (“DT”) Block, which are all in Ghana. | ||||||||
Effective January 14, 2014, the Ministry of Energy and Ghana National Petroleum Corporation (“GNPC”) entered into a Memorandum of Understanding with Kosmos Energy, on behalf of the WCTP Petroleum Agreement (“PA”) Block partners, wherein all parties have settled all matters pertaining to the Notices of Dispute for the Mahogany East PoD, and the Ministry of Energy has approved the Appraisal Programs for the Mahogany, Teak, and Akasa discoveries. | ||||||||
Mahogany— Three appraisal wells have been drilled. Additionally, we deepened a development well in the Jubilee Field to further appraise the Mahogany discovery. Following additional appraisal and evaluation, a decision regarding commerciality of the Mahogany discovery is expected to be made by the WCTP Block partners in early 2015. Within six months of such a declaration, a PoD would be prepared and submitted to Ghana’s Ministry of Energy, as required under the WCTP PA. | ||||||||
Teak-1 Discovery—Two appraisal wells have been drilled. Following additional appraisal and evaluation, a decision regarding commerciality of the Teak-1 discovery is expected to be made by the WCTP Block partners in early 2015. Within six months of such a declaration, a PoD would be prepared and submitted to Ghana’s Ministry of Energy, as required under the WCTP PA. | ||||||||
Teak-2 Discovery—We have performed a gauge installation on the well and are reprocessing seismic data. Following additional appraisal and evaluation, a decision regarding commerciality of the Teak-2 discovery is expected to be made by the WCTP Block partners in early 2015. Within six months of such a declaration, a PoD would be prepared and submitted to Ghana’s Ministry of Energy, as required under the WCTP PA. | ||||||||
Akasa Discovery—We performed a drill stem test and gauge installation on the discovery well and drilled one appraisal well. Following additional appraisal and evaluation, a decision regarding commerciality of the Akasa discovery is expected to be made by the WCTP Block partners in early 2015. Within six months of such a declaration, a PoD would be prepared and submitted to Ghana’s Ministry of Energy, as required under the WCTP PA. | ||||||||
Tweneboa, Enyenra and Ntomme (“TEN”) Discoveries—In May 2013, the government of Ghana approved the PoD over the TEN discoveries. Development of TEN is expected to include the drilling and completion of up to 24 development wells, half of the wells are designed as producers, with the remaining wells designed for water or gas injection. The TEN project is expected to deliver first oil in the second half of 2016. The costs associated with the TEN development will remain as unproved property pending the determination of whether the discoveries are associated with proved reserves. | ||||||||
Wawa Discovery—We are currently reprocessing seismic data and have acquired a high resolution seismic survey over the discovery area. Following additional evaluation and potential appraisal activities, a decision regarding commerciality of the Wawa discovery is expected to be made by the DT Block partners in 2015. Within six months of such declaration, a PoD would be prepared and submitted to Ghana’s Ministry of Energy, as required under the DT PA. | ||||||||
Accrued_Liabilities
Accrued Liabilities | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Accrued Liabilities | ' | |||||||
Accrued Liabilities | ' | |||||||
5. Accrued Liabilities | ||||||||
Accrued liabilities consisted of the following: | ||||||||
June 30, | December 31, | |||||||
2014 | 2013 | |||||||
(In thousands) | ||||||||
Accrued liabilities: | ||||||||
Accrued exploration, development and production | $ | 130,350 | $ | 73,976 | ||||
Income taxes | 56,673 | 20,379 | ||||||
Accrued taxes other than income | 16,857 | 15,188 | ||||||
Accrued general and administrative expenses | 10,906 | 4,255 | ||||||
Accrued other | 2,044 | 1,414 | ||||||
$ | 216,830 | $ | 115,212 | |||||
Debt
Debt | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
Debt | ' | |||||||||||||||||||
Debt | ' | |||||||||||||||||||
6. Debt | ||||||||||||||||||||
Facility | ||||||||||||||||||||
In March 2014, the Company amended and restated the then existing commercial debt facility (the “Facility”) with a total commitment of $1.5 billion from a number of financial institutions. The Facility supports our oil and gas exploration, appraisal and development programs and corporate activities. | ||||||||||||||||||||
As part of the debt refinancing in March 2014, the repayment of borrowings under the existing facility attributable to financial institutions that did not participate in the amended Facility was accounted for as an extinguishment of debt, and existing unamortized debt issuance costs attributable to those participants were expensed. As a result, we recorded a $2.9 million loss on the extinguishment of debt. As of June 30, 2014, we have $48.2 million of net deferred financing costs related to the Facility, which will be amortized over the remaining term of the Facility, including certain costs related to the amendment. | ||||||||||||||||||||
As of June 30, 2014, borrowings under the Facility totaled $800.0 million and the undrawn availability under the Facility was $700.0 million. | ||||||||||||||||||||
Interest is the aggregate of the applicable margin (3.25% to 4.50%, depending on the length of time that has passed from the date the Facility was entered into); LIBOR; and mandatory cost (if any, as defined in the Facility). Interest is payable on the last day of each interest period (and, if the interest period is longer than six months, on the dates falling at six-month intervals after the first day of the interest period). We pay commitment fees on the undrawn and unavailable portion of the total commitments, if any. Commitment fees are equal to 40% per annum of the then-applicable respective margin when a commitment is available for utilization and, equal to 20% per annum of the then-applicable respective margin when a commitment is not available for utilization. We recognize interest expense in accordance with ASC 835—Interest, which requires interest expense to be recognized using the effective interest method. As part of the March 2014 amendment, the Facility’s estimated effective interest rate was changed and, accordingly, we adjusted our estimate of deferred interest previously recorded during prior years by $4.5 million, which was recorded as a reduction to interest expense. | ||||||||||||||||||||
The Facility provides a revolving-credit and letter of credit facility. The availability period for the revolving-credit facility, as amended in March 2014 expires on March 31, 2018, however the Facility has a revolving-credit sublimit, which will be the lesser of $500.0 million and the total available facility at that time, that will be available for drawing until the date falling one month prior to the final maturity date. The letter of credit sublimit expires on the final maturity date. The available facility amount is subject to borrowing base constraints and, beginning on March 31, 2018, outstanding borrowings will be constrained by an amortization schedule. The Facility has a final maturity date of March 31, 2021. As of June 30, 2014, we had no letters of credit issued under the Facility. | ||||||||||||||||||||
Kosmos has the right to cancel all the undrawn commitments under the Facility. The amount of funds available to be borrowed under the Facility, also known as the borrowing base amount, is determined each year on March 31 and September 30 as part of a forecast that is prepared by and agreed to by us and the Technical and Modeling Bank and the Facility Agent. The formula to calculate the borrowing base amount is based on the sum of the net present values of net cash flows and relevant capital expenditures reduced by certain percentages as well as value attributable to certain assets’ reserves and/or resources. | ||||||||||||||||||||
If an event of default exists under the Facility, the lenders can accelerate the maturity and exercise other rights and remedies, including the enforcement of security granted pursuant to the Facility over certain assets held by our subsidiaries. The Facility contains customary cross default provisions. | ||||||||||||||||||||
We were in compliance with the financial covenants contained in the Facility as of the March 31, 2014 forecast (the most recent assessment date). | ||||||||||||||||||||
Corporate Revolver | ||||||||||||||||||||
In November 2012, we secured a Corporate Revolver from a number of financial institutions. In April 2013, the availability under the Corporate Revolver was increased from $260.0 million to $300.0 million due to additional commitments received from existing and new financial institutions. As of June 30, 2014, there were no borrowings outstanding under the Corporate Revolver and the undrawn availability under the Corporate Revolver was $300.0 million. The Corporate Revolver contains customary cross default provisions. | ||||||||||||||||||||
Revolving Letter of Credit Facility | ||||||||||||||||||||
In July 2013, we entered into a LC Facility. The size of the LC Facility is $100.0 million, with additional commitments up to $50.0 million being available if the existing lender increases its commitment or if commitments from new financial institutions are added. As of June 30, 2014, we had $35.3 million of restricted cash collateralizing seven outstanding letters of credit under the LC Facility. The LC Facility contains customary cross default provisions. | ||||||||||||||||||||
At June 30, 2014, the estimated repayments of debt during the five fiscal year periods and thereafter are as follows: | ||||||||||||||||||||
Payments Due by Year | ||||||||||||||||||||
2014(1) | 2015 | 2016 | 2017 | 2018 | Thereafter | |||||||||||||||
(In thousands) | ||||||||||||||||||||
Facility(2) | $ | — | $ | — | $ | — | $ | — | $ | 35,812 | $ | 764,188 | ||||||||
-1 | Represents payments for the period July 1, 2014 through December 31, 2014. | |||||||||||||||||||
-2 | The scheduled maturities of debt are based on the level of borrowings and the estimated future available borrowing base as of June 30, 2014. Any increases or decreases in the level of borrowings or decreases in the available borrowing base would impact the scheduled maturities of debt during the next five years and thereafter. | |||||||||||||||||||
Derivative_Financial_Instrumen
Derivative Financial Instruments | 6 Months Ended | ||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||
Derivative Financial Instruments | ' | ||||||||||||||||||||
Derivative Financial Instruments | ' | ||||||||||||||||||||
7. Derivative Financial Instruments | |||||||||||||||||||||
We use financial derivative contracts to manage exposures to commodity price and interest rate fluctuations. We do not hold or issue derivative financial instruments for trading purposes. We manage market and counterparty credit risk in accordance with our policies and guidelines. In accordance with these policies and guidelines, our management determines the appropriate timing and extent of derivative transactions. | |||||||||||||||||||||
Oil Derivative Contracts | |||||||||||||||||||||
The following table sets forth the volumes in barrels underlying the Company’s outstanding oil derivative contracts and the weighted average Dated Brent prices per Bbl for those contracts as of June 30, 2014. | |||||||||||||||||||||
Weighted Average Dated Brent Price per Bbl | |||||||||||||||||||||
Term | Type of Contract | MBbl | Net Deferred | Swap | Floor | Ceiling | Call | ||||||||||||||
Premium | |||||||||||||||||||||
Payable | |||||||||||||||||||||
2014:00:00 | |||||||||||||||||||||
July — December | Three-way collars | 3,014 | $ | 0.01 | $ | — | $ | 88.44 | $ | 113.75 | $ | 134.58 | |||||||||
2015:00:00 | |||||||||||||||||||||
January — December | Three-way collars | 3,230 | $ | 0.60 | $ | — | $ | 87.32 | $ | 110.00 | $ | 135.00 | |||||||||
January — December | Swaps with calls | 2,000 | — | 99.00 | — | — | 115.00 | ||||||||||||||
2016:00:00 | |||||||||||||||||||||
January — December | Purchased puts | 2,000 | $ | 3.41 | $ | — | $ | 85.00 | $ | — | $ | — | |||||||||
Provisional Oil Sales | |||||||||||||||||||||
At June 30, 2014, we had sales volumes of 973.8 MBbls provisionally priced at an average of $113.84 per Bbl, after differentials, which are subject to final pricing over the next month. | |||||||||||||||||||||
Interest Rate Swap Derivative Contracts | |||||||||||||||||||||
The following table summarizes our open interest rate swaps as of June 30, 2014, whereby we pay a fixed rate of interest and the counterparty pays a variable LIBOR-based rate: | |||||||||||||||||||||
Term | Weighted Average | Weighted Average | Floating Rate | ||||||||||||||||||
Notional Amount | Fixed Rate | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||
July 2014 — December 2014 | $ | 110,555 | 1.93 | % | 6-month LIBOR | ||||||||||||||||
January 2015 — December 2015 | 45,319 | 2.03 | % | 6-month LIBOR | |||||||||||||||||
January 2016 — June 2016 | 12,500 | 2.27 | % | 6-month LIBOR | |||||||||||||||||
The following tables disclose the Company’s derivative instruments as of June 30, 2014 and December 31, 2013 and gain/(loss) from derivatives during the three and six months ended June 30, 2014 and 2013, respectively: | |||||||||||||||||||||
Estimated Fair Value | |||||||||||||||||||||
Asset (Liability) | |||||||||||||||||||||
June 30, | December 31, | ||||||||||||||||||||
Type of Contract | Balance Sheet Location | 2014 | 2013 | ||||||||||||||||||
(In thousands) | |||||||||||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||
Derivative liabilities: | |||||||||||||||||||||
Commodity(1) | Derivatives liabilities—current | $ | (20,027 | ) | $ | (7,873 | ) | ||||||||||||||
Interest rate | Derivatives liabilities—current | (1,353 | ) | (2,067 | ) | ||||||||||||||||
Commodity(2) | Derivatives liabilities—long-term | (13,710 | ) | (3,144 | ) | ||||||||||||||||
Interest rate | Derivatives liabilities—long-term | (263 | ) | (667 | ) | ||||||||||||||||
Total derivatives not designated as hedging instruments | $ | (35,353 | ) | $ | (13,751 | ) | |||||||||||||||
-1 | Includes $3.4 million and zero as of June 30, 2014 and December 31 2013, respectively which represents our provisional oil sales contract. Also, includes net deferred premiums payable of $0.9 million and $0.1 million related to commodity derivative contracts as of June 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||||
-2 | Includes net deferred premiums payable of $7.9 million and $6.5 million related to commodity derivative contracts as of June 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||||
Amount of Gain/(Loss) | Amount of Gain/(Loss) | ||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||
June 30, | June 30, | ||||||||||||||||||||
Type of Contract | Location of Gain/(Loss) | 2014 | 2013 | 2014 | 2013 | ||||||||||||||||
(In thousands) | |||||||||||||||||||||
Derivatives in cash flow hedging relationships: | |||||||||||||||||||||
Interest rate(1) | Interest expense | $ | 405 | $ | 358 | $ | 811 | $ | 717 | ||||||||||||
Total derivatives in cash flow hedging relationships | $ | 405 | $ | 358 | $ | 811 | $ | 717 | |||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||
Commodity(2) | Oil and gas revenue | $ | (1,841 | ) | $ | (9,252 | ) | $ | (3,367 | ) | $ | (4,664 | ) | ||||||||
Commodity | Derivatives, net | (21,566 | ) | 12,707 | (19,538 | ) | 7,199 | ||||||||||||||
Interest rate | Interest expense | (109 | ) | 23 | (207 | ) | 50 | ||||||||||||||
Total derivatives not designated as hedging instruments | $ | (23,516 | ) | $ | 3,478 | $ | (23,112 | ) | $ | 2,585 | |||||||||||
-1 | Amounts were reclassified from accumulated other comprehensive income or loss (“AOCI”) into earnings upon settlement. | ||||||||||||||||||||
-2 | Amounts represent the mark-to-market portion of our provisional oil sales contracts. | ||||||||||||||||||||
Offsetting of Derivative Assets and Derivative Liabilities | |||||||||||||||||||||
Our derivative instruments which are subject to master netting arrangements with our counterparties only have the right of offset when there is an event of default. As of June 30, 2014 and December 31, 2013, there was not an event of default and, therefore, the associated gross asset or gross liability amounts related to these arrangements are presented on the consolidated balance sheets. Additionally, if an event of default occurred the offsetting amounts would be immaterial as of June 30, 2014 and December 31, 2013. | |||||||||||||||||||||
Fair_Value_Measurements
Fair Value Measurements | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Fair Value Measurements | ' | |||||||||||||
Fair Value Measurements | ' | |||||||||||||
8. Fair Value Measurements | ||||||||||||||
In accordance with ASC 820—Fair Value Measurements and Disclosures, fair value measurements are based upon inputs that market participants use in pricing an asset or liability, which are classified into two categories: observable inputs and unobservable inputs. Observable inputs represent market data obtained from independent sources, whereas unobservable inputs reflect a company’s own market assumptions, which are used if observable inputs are not reasonably available without undue cost and effort. We prioritize the inputs used in measuring fair value into the following fair value hierarchy: | ||||||||||||||
· | Level 1—quoted prices for identical assets or liabilities in active markets. | |||||||||||||
· | Level 2—quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and inputs derived principally from or corroborated by observable market data by correlation or other means. | |||||||||||||
· | Level 3—unobservable inputs for the asset or liability. The fair value input hierarchy level to which an asset or liability measurement in its entirety falls is determined based on the lowest level input that is significant to the measurement in its entirety. | |||||||||||||
The following tables present the Company’s assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2014 and December 31, 2013, for each fair value hierarchy level: | ||||||||||||||
Fair Value Measurements Using: | ||||||||||||||
Quoted Prices in | Significant Other | Significant | ||||||||||||
Active Markets for | Observable Inputs | Unobservable Inputs | ||||||||||||
Identical Assets | ||||||||||||||
(Level 1) | (Level 2) | (Level 3) | Total | |||||||||||
(In thousands) | ||||||||||||||
June 30, 2014 | ||||||||||||||
Liabilities: | ||||||||||||||
Commodity derivatives | $ | — | $ | (33,737 | ) | $ | — | $ | (33,737 | ) | ||||
Interest rate derivatives | — | (1,616 | ) | — | (1,616 | ) | ||||||||
Total | $ | — | $ | (35,353 | ) | $ | — | $ | (35,353 | ) | ||||
December 31, 2013 | ||||||||||||||
Liabilities: | ||||||||||||||
Commodity derivatives | $ | — | $ | (11,017 | ) | $ | — | $ | (11,017 | ) | ||||
Interest rate derivatives | — | (2,734 | ) | — | (2,734 | ) | ||||||||
Total | $ | — | $ | (13,751 | ) | $ | — | $ | (13,751 | ) | ||||
The book values of cash and cash equivalents and restricted cash approximate fair value based on Level 1 inputs. Joint interest billings, oil sales and other receivables, and accounts payable and accrued liabilities approximate fair value due to the short-term nature of these instruments. The carrying values of our debt approximates fair value since they are subject to short-term floating interest rates that approximate the rates available to us for those periods. Our long-term receivables, if any, after any allowances for doubtful accounts approximate fair value. The estimates of fair value of these items are based on Level 2 inputs. | ||||||||||||||
Commodity Derivatives | ||||||||||||||
Our commodity derivatives represent crude oil three-way collars, purchased puts and swaps with calls for notional barrels of oil at fixed Dated Brent oil prices. The values attributable to the our oil derivatives are based on (i) the contracted notional volumes, (ii) independent active futures price quotes for Dated Brent, (iii) a credit-adjusted yield curve applicable to each counterparty by reference to the credit default swap (“CDS”) market and (iv) an independently sourced estimate of volatility for Dated Brent. The volatility estimate was provided by certain independent brokers who are active in buying and selling oil options and was corroborated by market-quoted volatility factors. The deferred premium is included in the fair market value of the commodity derivatives. See Note 7—Derivative Financial Instruments for additional information regarding the Company’s derivative instruments. | ||||||||||||||
Provisional Oil Sales | ||||||||||||||
The value attributable to the provisional oil sales derivative is based on (i) the sales volumes subject to provisional pricing and (ii) an independently sourced forward curve over the term of the provisional pricing period. | ||||||||||||||
Interest Rate Derivatives | ||||||||||||||
We have interest rate swaps, whereby the Company pays a fixed rate of interest and the counterparty pays a variable LIBOR-based rate. The values attributable to the Company’s interest rate derivative contracts are based on (i) the contracted notional amounts, (ii) LIBOR yield curves provided by independent third parties and corroborated with forward active market-quoted LIBOR yield curves and (iii) a credit-adjusted yield curve as applicable to each counterparty by reference to the CDS market. | ||||||||||||||
Equitybased_Compensation
Equity-based Compensation | 6 Months Ended | |||||||||||
Jun. 30, 2014 | ||||||||||||
Equity-based Compensation | ' | |||||||||||
Equity-based Compensation | ' | |||||||||||
9. Equity-based Compensation | ||||||||||||
Restricted Stock Awards and Restricted Stock Units | ||||||||||||
We record compensation expense equal to the fair value of share-based payments over the vesting periods of the LTIP awards. We recorded compensation expense from awards granted under our LTIP of $18.0 million and $18.1 million during the three months ended June 30, 2014 and 2013, respectively, and $35.9 million and $37.0 million during the six months ended June 30, 2014 and 2013. During the three and six months ended June 30, 2014, an additional $5.0 million of equity-based compensation was recorded as restructuring charges. The total tax benefit for the three months ended June 30, 2014 and 2013 was $8.0 million and $6.3 million, respectively, and for the six months ended June 30, 2014 and 2013 was $14.1 million and $12.7 million. Additionally, we expensed a tax shortfall related to equity-based compensation of $6.4 million and $6.9 million for the three months ended June 30, 2014 and 2013, respectively, and $6.5 million and $6.9 million for the six months ended June 30, 2014 and 2013 respectively. The Company granted both restricted stock awards and restricted stock units with service vesting criteria and granted both restricted stock awards and restricted stock units with a combination of market and service criteria under the LTIP. Restricted stock awards are issued and included in the number of outstanding shares upon the date of grant and, if such awards are forfeited, they become treasury stock. Upon vesting, restricted stock units become issued and outstanding stock. | ||||||||||||
The following table reflects the outstanding restricted stock awards as of June 30, 2014: | ||||||||||||
Weighted- | Market / Service | Weighted- | ||||||||||
Service Vesting | Average | Vesting | Average | |||||||||
Restricted Stock | Grant-Date | Restricted Stock | Grant-Date | |||||||||
Awards | Fair Value | Awards | Fair Value | |||||||||
(In thousands) | (In thousands) | |||||||||||
Outstanding at December 31, 2013 | 6,384 | $ | 16.48 | 3,438 | $ | 12.95 | ||||||
Granted | — | — | — | — | ||||||||
Forfeited | (104 | ) | 15.85 | (33 | ) | 8.94 | ||||||
Vested | (2,783 | ) | 17.06 | — | — | |||||||
Outstanding at June 30, 2014 | 3,497 | 16.03 | 3,405 | 12.98 | ||||||||
The following table reflects the outstanding restricted stock units as of June 30, 2014: | ||||||||||||
Weighted- | Market / Service | Weighted- | ||||||||||
Service Vesting | Average | Vesting | Average | |||||||||
Restricted Stock | Grant-Date | Restricted Stock | Grant-Date | |||||||||
Units | Fair Value | Units | Fair Value | |||||||||
(In thousands) | (In thousands) | |||||||||||
Outstanding at December 31, 2013 | 2,238 | $ | 10.74 | 1,858 | $ | 15.59 | ||||||
Granted | 1,910 | 10.97 | 1,438 | 15.44 | ||||||||
Forfeited | (343 | ) | 10.92 | (152 | ) | 15.44 | ||||||
Vested | (403 | ) | 10.85 | — | — | |||||||
Outstanding at June 30, 2014 | 3,402 | 10.84 | 3,144 | 15.53 | ||||||||
As of June 30, 2014, total equity-based compensation to be recognized on unvested restricted stock awards and restricted stock units is $122.5 million over a weighted average period of 1.75 years. At June 30, 2014, the Company had approximately 2.2 million shares that remain available for issuance under the LTIP. | ||||||||||||
For restricted stock awards with a combination of market and service vesting criteria, the number of common shares to be issued is determined by comparing the Company’s total shareholder return with the total shareholder return of a predetermined group of peer companies over the performance period and can vest in up to 100% of the awards granted. The grant date fair value of these awards ranged from $6.70 to $13.57 per award. The Monte Carlo simulation model utilizes multiple input variables that determine the probability of satisfying the market condition stipulated in the award grant and calculates the fair value of the award. The expected volatility utilized in the model was estimated using our historical volatility and the historical volatilities of our peer companies and ranged from 41.3% to 56.7%. The risk-free interest rate was based on the U.S. treasury rate for a term commensurate with the expected life of the grant and ranged from 0.5% to 1.1%. | ||||||||||||
For restricted stock units with a combination of market and service vesting criteria, the number of common shares to be issued is determined by comparing the Company’s total shareholder return with the total shareholder return of a predetermined group of peer companies over the performance period and can vest in up to 200% of the awards granted. The grant date fair value of these awards ranged from $15.44 to $15.81 per award. The Monte Carlo simulation model utilizes multiple input variables that determine the probability of satisfying the market condition stipulated in the award grant and calculates the fair value of the award. The expected volatility utilized in the model was estimated using our historical volatility and the historical volatilities of our peer companies and ranged from 53.0% to 54.0%. The risk-free interest rate was based on the U.S. treasury rate for a term commensurate with the expected life of the grant and ranged from 0.5% to 0.7%. | ||||||||||||
Income_Taxes
Income Taxes | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Income Taxes | ' | |||||||||||||
Income Taxes | ' | |||||||||||||
10. Income Taxes | ||||||||||||||
Income tax expense was $80.8 million and $46.3 million for the three months ended June 30, 2014 and 2013, respectively, and $131.6 million and $90.3 million for the six months ended June 30, 2014 and 2013, respectively. The income tax provision consists of United States and Ghanaian income and Texas margin taxes. | ||||||||||||||
The components of income (loss) before income taxes were as follows: | ||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
(In thousands) | ||||||||||||||
Bermuda | $ | (6,904 | ) | $ | (6,663 | ) | $ | (12,219 | ) | $ | (13,440 | ) | ||
United States | 4,207 | 2,903 | 7,494 | 5,273 | ||||||||||
Foreign—other | 139,988 | (20,803 | ) | 267,768 | 47,789 | |||||||||
Income (loss) before income taxes | $ | 137,291 | $ | (24,563 | ) | $ | 263,043 | $ | 39,622 | |||||
Our effective tax rate for the three months ended June 30, 2014 and 2013 is 59% and (188)%, respectively. For the six months ended June 30, 2014 and 2013, our effective tax rate is 50% and 228%, respectively. The effective tax rate for the United States is approximately 193% and 274% for the three months ended June 30, 2014 and 2013, respectively, and 128% and 167% for the six months ended June 30, 2014 and 2013, respectively. The effective tax rate in the United States is impacted by the effect of tax shortfalls related to equity-based compensation. The effective tax rate for Ghana is approximately 36% and 34% for the three months ended June 30, 2014 and 2013, respectively, and 36% for the six months ended June 30, 2014 and 2013. Our other foreign jurisdictions have a 0% effective tax rate because they reside in countries with a 0% statutory rate, or we have experienced losses in those countries and have a full valuation allowance reserved against the corresponding net deferred tax assets. | ||||||||||||||
The Company has no material unrecognized income tax benefits. | ||||||||||||||
A subsidiary of the Company files a U.S. federal income tax return and a Texas margin tax return. In addition to the United States, the Company files income tax returns in the countries in which the Company operates. The Company is open to U.S. federal income tax examinations for tax years 2012 through 2013 and to Texas margin tax examinations for the tax years 2009 through 2013. In addition, the Company is open to income tax examinations for years 2004 through 2013 in its significant other foreign jurisdictions (Ghana, Cameroon, Mauritania, Suriname and Morocco). | ||||||||||||||
As of June 30, 2014, the Company had no material uncertain tax positions. The Company’s policy is to recognize potential interest and penalties related to income tax matters in income tax expense, but have not accrued any material amounts to date. | ||||||||||||||
Net_Income_Loss_Per_Share
Net Income (Loss) Per Share | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Net Income (Loss) Per Share | ' | |||||||||||||
Net Income (Loss) Per Share | ' | |||||||||||||
11. Net Income (Loss) Per Share | ||||||||||||||
The following table is a reconciliation between net income and the amounts used to compute basic and diluted net income per share and the weighted average shares outstanding used to compute basic and diluted net income per share: | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
(In thousands, except per share data) | ||||||||||||||
Numerator: | ||||||||||||||
Net income (loss) | $ | 56,507 | $ | (70,816 | ) | $ | 131,476 | $ | (50,722 | ) | ||||
Less: Basic income allocable to participating securities(1) | (721 | ) | — | (1,920 | ) | — | ||||||||
Basic net income (loss) allocable to common shareholders | 55,786 | (70,816 | ) | 129,556 | (50,722 | ) | ||||||||
Diluted adjustments to income allocable to participating securities(1) | 6 | — | 15 | — | ||||||||||
Diluted net income (loss) allocable to common shareholders | $ | 55,792 | $ | (70,816 | ) | $ | 129,571 | $ | (50,722 | ) | ||||
Denominator: | ||||||||||||||
Weighted average number of shares used to compute net income (loss) per share: | ||||||||||||||
Basic | 378,820 | 376,563 | 378,327 | 375,927 | ||||||||||
Restricted stock awards and units(1)(2) | 2,998 | — | 2,830 | — | ||||||||||
Diluted | 381,818 | 376,563 | 381,157 | 375,927 | ||||||||||
Net income (loss) per share: | ||||||||||||||
Basic | $ | 0.15 | $ | (0.19 | ) | $ | 0.34 | $ | (0.13 | ) | ||||
Diluted | $ | 0.15 | $ | (0.19 | ) | $ | 0.34 | $ | (0.13 | ) | ||||
-1 | Our service vesting restricted stock awards represent participating securities because they participate in nonforfeitable dividends with common equity owners. Income allocable to participating securities represents the distributed and undistributed earnings attributable to the participating securities. Our restricted stock awards with market and service vesting criteria and all restricted stock units are not considered to be participating securities and, therefore, are excluded from the basic net income per common share calculation. Our service vesting restricted stock awards do not participate in undistributed net losses and, therefore, are excluded from the basic net income per common share calculation in periods we are in a net loss position. | |||||||||||||
-2 | We excluded outstanding restricted stock awards of 4.4 million and 14.2 million for the three months ended June 30, 2014 and 2013, respectively, and 4.4 million and 14.2 million for the six months ended June 30, 2014 and 2013, respectively, from the computations of diluted net income per share because the effect would have been anti-dilutive. | |||||||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 6 Months Ended | ||||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||||
Commitments and Contingencies | ' | ||||||||||||||||||||||
Commitments and Contingencies | ' | ||||||||||||||||||||||
12. Commitments and Contingencies | |||||||||||||||||||||||
We are involved in litigation, regulatory examinations and administrative proceedings primarily arising in the ordinary course of our business in jurisdictions in which we do business. Although the outcome of these matters cannot be predicted with certainty, management believes none of these matters, either individually or in the aggregate, would have a material effect upon the Company’s financial position; however, an unfavorable outcome could have a material adverse effect on our results from operations for a specific interim period or year. | |||||||||||||||||||||||
In June 2013, we signed a long-term rig agreement with a subsidiary of Atwood Oceanics, Inc. for the new build drillship “Atwood Achiever.” Currently under construction, the rig is expected to commence drilling operations in the second half of 2014. The rig agreement covers an initial period of three years at a day rate of approximately $0.6 million, with an option to extend the agreement for an additional three-year term. We have entered into a rig sharing agreement, whereby two rig slots (estimated to be 150 days in total during 2015) were assigned to a third-party. The estimated rig delivery date is in the third quarter of 2014. | |||||||||||||||||||||||
The estimated future minimum commitments under this contract as of June 30, 2014, are: | |||||||||||||||||||||||
Payments Due By Year(1) | |||||||||||||||||||||||
Total | 2014(2) | 2015 | 2016 | 2017 | 2018 | Thereafter | |||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Operating leases | $ | 18,722 | $ | 2,372 | $ | 3,515 | $ | 3,158 | $ | 3,223 | $ | 3,323 | $ | 3,131 | |||||||||
Atwood Achiever drilling rig contract (3) | 562,870 | 91,035 | 127,925 | 217,770 | 126,140 | — | — | ||||||||||||||||
-1 | Does not include purchase commitments for jointly owned fields and facilities where we are not the operator and excludes commitments for exploration activities, including well commitments, in our petroleum contracts. | ||||||||||||||||||||||
-2 | Represents payments for the period from July 1, 2014 through December 31, 2014. | ||||||||||||||||||||||
(3)Commitments calculated using a day rate of $595,000 and assuming a rig delivery date of August 1, 2014. The rig commitments reflect the execution of a rig sharing agreement, whereby two rig slots (estimated to be 150 days in total during 2015) were assigned to a third-party. | |||||||||||||||||||||||
Subsequent_Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2014 | |
Subsequent Events | ' |
Subsequent Events | ' |
13. Subsequent Events | |
During August 2014, the Company issued $300.0 million of 7.875% Senior Notes due 2021 (the “Notes”) and received net proceeds of $292.5 million after deducting discounts, commissions and other expenses. The Company expects to use the net proceeds of the offering of the Notes to repay a portion of the outstanding indebtedness under the Facility and for general corporate purposes. | |
The Notes are secured (subject to certain exceptions and permitted liens) by a first ranking fixed equitable charge on all shares held by the Company in its direct subsidiary, Kosmos Energy Holdings. The Notes are currently guaranteed on a subordinated, unsecured basis by Kosmos Energy Operating, Kosmos Energy International, Kosmos Energy Development, Kosmos Energy Ghana HC and Kosmos Energy Finance International, being the Company’s subsidiaries that guarantee the Facility and the Corporate Revolver. |
Accounting_Policies_Policies
Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2014 | |
Accounting Policies | ' |
General | ' |
General | |
The interim-period financial information presented in the consolidated financial statements included in this report is unaudited and, in the opinion of management, includes all adjustments of a normal recurring nature necessary to present fairly the consolidated financial position as of June 30, 2014, the changes in the consolidated statements of shareholders’ equity for the six months ended June 30, 2014, the consolidated results of operations for the three and six months ended June 30, 2014 and 2013, and consolidated cash flows for the six months ended June 30, 2014 and 2013. The results of the interim periods shown in this report are not necessarily indicative of the final results to be expected for the full year. The consolidated financial statements were prepared in accordance with the requirements of the Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain notes or other financial information that are normally required by Generally Accepted Accounting Principles in the United States of America (“GAAP”) have been condensed or omitted from these interim consolidated financial statements. These consolidated financial statements and the accompanying notes should be read in conjunction with our audited consolidated financial statements for the year ended December 31, 2013, included in our annual report on Form 10-K. | |
Reclassifications | ' |
Reclassifications | |
Certain prior period amounts have been reclassified to conform with the current year presentation. Such reclassifications had no impact on our reported net loss, current assets, total assets, current liabilities, total liabilities or shareholders’ equity. | |
Restricted Cash | ' |
Restricted Cash | |
In accordance with our commercial debt facility, we are required to maintain a restricted cash balance that is sufficient to meet the payment of interest and fees for the next six-month period. As of June 30, 2014 and December 31, 2013, we had $18.6 million and $18.6 million, respectively, in current restricted cash to meet this requirement. In addition, in accordance with certain of our petroleum contracts, we have posted letters of credit related to performance guarantees for our minimum work obligations. These letters of credit are cash collateralized in accounts held by us and as such are classified as restricted cash. Upon completion of the minimum work obligations and/or entering into the next phase of the petroleum contract, the requirement to post the existing letters of credit will be satisfied and the cash collateral will be released. However, additional letters of credit may be required should we choose to move into the next phase of certain of our petroleum contracts. As of June 30, 2014 and December 31, 2013, we had $1.0 million and $2.9 million, respectively, of current restricted cash and $35.3 million and $31.5 million, respectively, of long-term restricted cash used to cash collateralize performance guarantees related to our petroleum contracts. | |
Inventories | ' |
Inventories | |
Inventories consisted of $39.8 million and $45.8 million of materials and supplies and nil and $1.6 million of hydrocarbons as of June 30, 2014 and December 31, 2013, respectively. The Company’s materials and supplies inventory primarily consists of casing and wellheads and is stated at the lower of cost, using the weighted average cost method, or market. | |
Hydrocarbon inventory is carried at the lower of cost, using the weighted average cost method, or market. Hydrocarbon inventory costs include expenditures and other charges incurred in bringing the inventory to its existing condition. Selling expenses and general and administrative expenses are reported as period costs and excluded from inventory costs. | |
Variable Interest Entity | ' |
Variable Interest Entity | |
Our wholly owned subsidiary, Kosmos Energy Finance International, is a variable interest entity (“VIE”). The Company is the primary beneficiary of this VIE, which is consolidated in these financial statements. | |
The following assets and liabilities of Kosmos Energy Finance International are shown separately on the face of the consolidated balance sheets as of June 30, 2014 and December 31, 2013: long-term debt and long-term derivatives liabilities. At June 30, 2014, Kosmos Energy Finance International had $38.6 million in cash and cash equivalents; $18.6 million in current restricted cash; $48.2 million deferred financing costs, net; $0.9 million in accounts payable; $0.1 million in accrued liabilities; $18.0 million in current derivatives and $4.4 million in other long-term liabilities, which are included in the amounts shown on the face of the consolidated balance sheets. At December 31, 2013, Kosmos Energy Finance International had $38.1 million in cash and cash equivalents; $18.6 million in current restricted cash; $0.2 million in prepaid expenses and other; $34.2 million deferred financing costs, net; $1.4 million in accrued liabilities; $9.9 million in current derivatives and $8.2 million in other long-term liabilities, which are included in the amounts shown on the face of the consolidated balance sheets. | |
Restructuring charges | ' |
Restructuring Charges | |
The Company accounts for restructuring charges in accordance with ASC 420-Exit or Disposal Cost Obligations. Under these standards, the costs associated with restructuring charges are recorded during the period in which the liability is incurred. During the three months and six months ended June 30, 2014, we recognized $11.8 million in restructuring charges for employee severance and related benefit costs incurred as part of a corporate reorganization, which includes $5.0 million of accelerated non-cash expense related to awards previously granted under our Long-Term Incentive Plan (the “LTIP”). | |
Property_and_Equipment_Tables
Property and Equipment (Tables) | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Property and Equipment | ' | |||||||
Schedule of property and equipment | ' | |||||||
June 30, | December 31, | |||||||
2014 | 2013 | |||||||
(In thousands) | ||||||||
Oil and gas properties: | ||||||||
Proved properties | $ | 837,519 | $ | 801,348 | ||||
Unproved properties | 628,688 | 524,257 | ||||||
Support equipment and facilities | 724,238 | 710,289 | ||||||
Total oil and gas properties | 2,190,445 | 2,035,894 | ||||||
Less: accumulated depletion | (639,018 | ) | (527,832 | ) | ||||
Oil and gas properties, net | 1,551,427 | 1,508,062 | ||||||
Other property | 32,273 | 31,658 | ||||||
Less: accumulated depreciation | (19,296 | ) | (16,758 | ) | ||||
Other property, net | 12,977 | 14,900 | ||||||
Property and equipment, net | $ | 1,564,404 | $ | 1,522,962 | ||||
Suspended_Well_Costs_Tables
Suspended Well Costs (Tables) | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Suspended Well Costs | ' | |||||||
Schedule of capitalized exploratory well costs | ' | |||||||
Six Months | ||||||||
Ended | ||||||||
June 30, | ||||||||
2014 | ||||||||
(In thousands) | ||||||||
Beginning balance | $ | 376,166 | ||||||
Additions to capitalized exploratory well costs pending the determination of proved reserves | 46,265 | |||||||
Reclassification due to determination of proved reserves | — | |||||||
Capitalized exploratory well costs charged to expense | — | |||||||
Ending balance | $ | 422,431 | ||||||
Schedule of aging of capitalized exploratory well costs and number of projects for which exploratory well costs were capitalized for more than one year | ' | |||||||
June 30, 2014 | December 31, 2013 | |||||||
(In thousands, except well counts) | ||||||||
Exploratory well costs capitalized for a period of one year or less | $ | 45,638 | $ | 11,426 | ||||
Exploratory well costs capitalized for a period of one to two years | 171,871 | 229,140 | ||||||
Exploratory well costs capitalized for a period of three to five years | 204,922 | 135,600 | ||||||
Ending balance | $ | 422,431 | $ | 376,166 | ||||
Number of projects that have exploratory well costs that have been capitalized for a period greater than one year | 8 | 8 | ||||||
Accrued_Liabilities_Tables
Accrued Liabilities (Tables) | 6 Months Ended | |||||||
Jun. 30, 2014 | ||||||||
Accrued Liabilities | ' | |||||||
Accrued Liabilities | ' | |||||||
June 30, | December 31, | |||||||
2014 | 2013 | |||||||
(In thousands) | ||||||||
Accrued liabilities: | ||||||||
Accrued exploration, development and production | $ | 130,350 | $ | 73,976 | ||||
Income taxes | 56,673 | 20,379 | ||||||
Accrued taxes other than income | 16,857 | 15,188 | ||||||
Accrued general and administrative expenses | 10,906 | 4,255 | ||||||
Accrued other | 2,044 | 1,414 | ||||||
$ | 216,830 | $ | 115,212 | |||||
Debt_Tables
Debt (Tables) | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
Debt | ' | |||||||||||||||||||
Schedule of estimated repayments of debt | ' | |||||||||||||||||||
At June 30, 2014, the estimated repayments of debt during the five fiscal year periods and thereafter are as follows: | ||||||||||||||||||||
Payments Due by Year | ||||||||||||||||||||
2014(1) | 2015 | 2016 | 2017 | 2018 | Thereafter | |||||||||||||||
(In thousands) | ||||||||||||||||||||
Facility(2) | $ | — | $ | — | $ | — | $ | — | $ | 35,812 | $ | 764,188 | ||||||||
-1 | Represents payments for the period July 1, 2014 through December 31, 2014. | |||||||||||||||||||
-2 | The scheduled maturities of debt are based on the level of borrowings and the estimated future available borrowing base as of June 30, 2014. Any increases or decreases in the level of borrowings or decreases in the available borrowing base would impact the scheduled maturities of debt during the next five years and thereafter. | |||||||||||||||||||
Derivative_Financial_Instrumen1
Derivative Financial Instruments (Tables) | 6 Months Ended | ||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||
Derivative Financial Instruments | ' | ||||||||||||||||||||
Schedule of oil derivative contracts | ' | ||||||||||||||||||||
The following table sets forth the volumes in barrels underlying the Company’s outstanding oil derivative contracts and the weighted average Dated Brent prices per Bbl for those contracts as of June 30, 2014. | |||||||||||||||||||||
Weighted Average Dated Brent Price per Bbl | |||||||||||||||||||||
Term | Type of Contract | MBbl | Net Deferred | Swap | Floor | Ceiling | Call | ||||||||||||||
Premium | |||||||||||||||||||||
Payable | |||||||||||||||||||||
2014:00:00 | |||||||||||||||||||||
July — December | Three-way collars | 3,014 | $ | 0.01 | $ | — | $ | 88.44 | $ | 113.75 | $ | 134.58 | |||||||||
2015:00:00 | |||||||||||||||||||||
January — December | Three-way collars | 3,230 | $ | 0.60 | $ | — | $ | 87.32 | $ | 110.00 | $ | 135.00 | |||||||||
January — December | Swaps with calls | 2,000 | — | 99.00 | — | — | 115.00 | ||||||||||||||
2016:00:00 | |||||||||||||||||||||
January — December | Purchased puts | 2,000 | $ | 3.41 | $ | — | $ | 85.00 | $ | — | $ | — | |||||||||
Schedule of interest rate swaps derivative contracts | ' | ||||||||||||||||||||
The following table summarizes our open interest rate swaps as of June 30, 2014, whereby we pay a fixed rate of interest and the counterparty pays a variable LIBOR-based rate: | |||||||||||||||||||||
Term | Weighted Average | Weighted Average | Floating Rate | ||||||||||||||||||
Notional Amount | Fixed Rate | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||
July 2014 — December 2014 | $ | 110,555 | 1.93 | % | 6-month LIBOR | ||||||||||||||||
January 2015 — December 2015 | 45,319 | 2.03 | % | 6-month LIBOR | |||||||||||||||||
January 2016 — June 2016 | 12,500 | 2.27 | % | 6-month LIBOR | |||||||||||||||||
Schedule of derivative instruments by balance sheet location | ' | ||||||||||||||||||||
Estimated Fair Value | |||||||||||||||||||||
Asset (Liability) | |||||||||||||||||||||
June 30, | December 31, | ||||||||||||||||||||
Type of Contract | Balance Sheet Location | 2014 | 2013 | ||||||||||||||||||
(In thousands) | |||||||||||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||
Derivative liabilities: | |||||||||||||||||||||
Commodity(1) | Derivatives liabilities—current | $ | (20,027 | ) | $ | (7,873 | ) | ||||||||||||||
Interest rate | Derivatives liabilities—current | (1,353 | ) | (2,067 | ) | ||||||||||||||||
Commodity(2) | Derivatives liabilities—long-term | (13,710 | ) | (3,144 | ) | ||||||||||||||||
Interest rate | Derivatives liabilities—long-term | (263 | ) | (667 | ) | ||||||||||||||||
Total derivatives not designated as hedging instruments | $ | (35,353 | ) | $ | (13,751 | ) | |||||||||||||||
-1 | Includes $3.4 million and zero as of June 30, 2014 and December 31 2013, respectively which represents our provisional oil sales contract. Also, includes net deferred premiums payable of $0.9 million and $0.1 million related to commodity derivative contracts as of June 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||||
-2 | Includes net deferred premiums payable of $7.9 million and $6.5 million related to commodity derivative contracts as of June 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||||
Schedule of derivative instruments by location of gain/(loss) | ' | ||||||||||||||||||||
Amount of Gain/(Loss) | Amount of Gain/(Loss) | ||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||
June 30, | June 30, | ||||||||||||||||||||
Type of Contract | Location of Gain/(Loss) | 2014 | 2013 | 2014 | 2013 | ||||||||||||||||
(In thousands) | |||||||||||||||||||||
Derivatives in cash flow hedging relationships: | |||||||||||||||||||||
Interest rate(1) | Interest expense | $ | 405 | $ | 358 | $ | 811 | $ | 717 | ||||||||||||
Total derivatives in cash flow hedging relationships | $ | 405 | $ | 358 | $ | 811 | $ | 717 | |||||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||
Commodity(2) | Oil and gas revenue | $ | (1,841 | ) | $ | (9,252 | ) | $ | (3,367 | ) | $ | (4,664 | ) | ||||||||
Commodity | Derivatives, net | (21,566 | ) | 12,707 | (19,538 | ) | 7,199 | ||||||||||||||
Interest rate | Interest expense | (109 | ) | 23 | (207 | ) | 50 | ||||||||||||||
Total derivatives not designated as hedging instruments | $ | (23,516 | ) | $ | 3,478 | $ | (23,112 | ) | $ | 2,585 | |||||||||||
-1 | Amounts were reclassified from accumulated other comprehensive income or loss (“AOCI”) into earnings upon settlement. | ||||||||||||||||||||
(2)Amounts represent the mark-to-market portion of our provisional oil sales contracts. | |||||||||||||||||||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Fair Value Measurements | ' | |||||||||||||
Schedule of Company's assets and liabilities that are measured at fair value on a recurring basis | ' | |||||||||||||
Fair Value Measurements Using: | ||||||||||||||
Quoted Prices in | Significant Other | Significant | ||||||||||||
Active Markets for | Observable Inputs | Unobservable Inputs | ||||||||||||
Identical Assets | ||||||||||||||
(Level 1) | (Level 2) | (Level 3) | Total | |||||||||||
(In thousands) | ||||||||||||||
June 30, 2014 | ||||||||||||||
Liabilities: | ||||||||||||||
Commodity derivatives | $ | — | $ | (33,737 | ) | $ | — | $ | (33,737 | ) | ||||
Interest rate derivatives | — | (1,616 | ) | — | (1,616 | ) | ||||||||
Total | $ | — | $ | (35,353 | ) | $ | — | $ | (35,353 | ) | ||||
December 31, 2013 | ||||||||||||||
Liabilities: | ||||||||||||||
Commodity derivatives | $ | — | $ | (11,017 | ) | $ | — | $ | (11,017 | ) | ||||
Interest rate derivatives | — | (2,734 | ) | — | (2,734 | ) | ||||||||
Total | $ | — | $ | (13,751 | ) | $ | — | $ | (13,751 | ) | ||||
Equitybased_Compensation_Table
Equity-based Compensation (Tables) (LTIP) | 6 Months Ended | |||||||||||
Jun. 30, 2014 | ||||||||||||
Restricted stock awards | ' | |||||||||||
Equity-based Compensation | ' | |||||||||||
Schedule of plan activity | ' | |||||||||||
Weighted- | Market / Service | Weighted- | ||||||||||
Service Vesting | Average | Vesting | Average | |||||||||
Restricted Stock | Grant-Date | Restricted Stock | Grant-Date | |||||||||
Awards | Fair Value | Awards | Fair Value | |||||||||
(In thousands) | (In thousands) | |||||||||||
Outstanding at December 31, 2013 | 6,384 | $ | 16.48 | 3,438 | $ | 12.95 | ||||||
Granted | — | — | — | — | ||||||||
Forfeited | (104 | ) | 15.85 | (33 | ) | 8.94 | ||||||
Vested | (2,783 | ) | 17.06 | — | — | |||||||
Outstanding at June 30, 2014 | 3,497 | 16.03 | 3,405 | 12.98 | ||||||||
Restricted stock units | ' | |||||||||||
Equity-based Compensation | ' | |||||||||||
Schedule of plan activity | ' | |||||||||||
Weighted- | Market / Service | Weighted- | ||||||||||
Service Vesting | Average | Vesting | Average | |||||||||
Restricted Stock | Grant-Date | Restricted Stock | Grant-Date | |||||||||
Units | Fair Value | Units | Fair Value | |||||||||
(In thousands) | (In thousands) | |||||||||||
Outstanding at December 31, 2013 | 2,238 | $ | 10.74 | 1,858 | $ | 15.59 | ||||||
Granted | 1,910 | 10.97 | 1,438 | 15.44 | ||||||||
Forfeited | (343 | ) | 10.92 | (152 | ) | 15.44 | ||||||
Vested | (403 | ) | 10.85 | — | — | |||||||
Outstanding at June 30, 2014 | 3,402 | 10.84 | 3,144 | 15.53 | ||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Income Taxes | ' | |||||||||||||
Schedule of components of income before income taxes | ' | |||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
(In thousands) | ||||||||||||||
Bermuda | $ | (6,904 | ) | $ | (6,663 | ) | $ | (12,219 | ) | $ | (13,440 | ) | ||
United States | 4,207 | 2,903 | 7,494 | 5,273 | ||||||||||
Foreign—other | 139,988 | (20,803 | ) | 267,768 | 47,789 | |||||||||
Income (loss) before income taxes | $ | 137,291 | $ | (24,563 | ) | $ | 263,043 | $ | 39,622 | |||||
Net_Income_Loss_Per_Share_Tabl
Net Income (Loss) Per Share (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Net Income (Loss) Per Share | ' | |||||||||||||
Schedule of reconciliation between net income and the amounts used to compute basic and diluted net income per share and the weighted average shares outstanding used to compute basic and diluted net income per share | ' | |||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
(In thousands, except per share data) | ||||||||||||||
Numerator: | ||||||||||||||
Net income (loss) | $ | 56,507 | $ | (70,816 | ) | $ | 131,476 | $ | (50,722 | ) | ||||
Less: Basic income allocable to participating securities(1) | (721 | ) | — | (1,920 | ) | — | ||||||||
Basic net income (loss) allocable to common shareholders | 55,786 | (70,816 | ) | 129,556 | (50,722 | ) | ||||||||
Diluted adjustments to income allocable to participating securities(1) | 6 | — | 15 | — | ||||||||||
Diluted net income (loss) allocable to common shareholders | $ | 55,792 | $ | (70,816 | ) | $ | 129,571 | $ | (50,722 | ) | ||||
Denominator: | ||||||||||||||
Weighted average number of shares used to compute net income (loss) per share: | ||||||||||||||
Basic | 378,820 | 376,563 | 378,327 | 375,927 | ||||||||||
Restricted stock awards and units(1)(2) | 2,998 | — | 2,830 | — | ||||||||||
Diluted | 381,818 | 376,563 | 381,157 | 375,927 | ||||||||||
Net income (loss) per share: | ||||||||||||||
Basic | $ | 0.15 | $ | (0.19 | ) | $ | 0.34 | $ | (0.13 | ) | ||||
Diluted | $ | 0.15 | $ | (0.19 | ) | $ | 0.34 | $ | (0.13 | ) | ||||
-1 | Our service vesting restricted stock awards represent participating securities because they participate in nonforfeitable dividends with common equity owners. Income allocable to participating securities represents the distributed and undistributed earnings attributable to the participating securities. Our restricted stock awards with market and service vesting criteria and all restricted stock units are not considered to be participating securities and, therefore, are excluded from the basic net income per common share calculation. Our service vesting restricted stock awards do not participate in undistributed net losses and, therefore, are excluded from the basic net income per common share calculation in periods we are in a net loss position. | |||||||||||||
-2 | We excluded outstanding restricted stock awards of 4.4 million and 14.2 million for the three months ended June 30, 2014 and 2013, respectively, and 4.4 million and 14.2 million for the six months ended June 30, 2014 and 2013, respectively, from the computations of diluted net income per share because the effect would have been anti-dilutive. | |||||||||||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 6 Months Ended | ||||||||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||||||||
Commitments and Contingencies | ' | ||||||||||||||||||||||
Schedule of estimated future minimum commitments | ' | ||||||||||||||||||||||
The estimated future minimum commitments under this contract as of June 30, 2014, are: | |||||||||||||||||||||||
Payments Due By Year(1) | |||||||||||||||||||||||
Total | 2014(2) | 2015 | 2016 | 2017 | 2018 | Thereafter | |||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Operating leases | $ | 18,722 | $ | 2,372 | $ | 3,515 | $ | 3,158 | $ | 3,223 | $ | 3,323 | $ | 3,131 | |||||||||
Atwood Achiever drilling rig contract (3) | 562,870 | 91,035 | 127,925 | 217,770 | 126,140 | — | — | ||||||||||||||||
-1 | Does not include purchase commitments for jointly owned fields and facilities where we are not the operator and excludes commitments for exploration activities, including well commitments, in our petroleum contracts. | ||||||||||||||||||||||
-2 | Represents payments for the period from July 1, 2014 through December 31, 2014. | ||||||||||||||||||||||
-3 | Commitments calculated using a day rate of $595,000 and assuming a rig delivery date of August 1, 2014. The rig commitments reflect the execution of a rig sharing agreement, whereby two rig slots (estimated to be 150 days in total during 2015) were assigned to a third-party. | ||||||||||||||||||||||
Organization_Details
Organization (Details) | 6 Months Ended |
Jun. 30, 2014 | |
segment | |
Organization | ' |
Number of reportable segments | 1 |
Accounting_Policies_Details
Accounting Policies (Details) (USD $) | 6 Months Ended | |
Jun. 30, 2014 | Dec. 31, 2013 | |
Restricted Cash | ' | ' |
Current restricted cash | $19,552,000 | $21,475,000 |
Long-term restricted cash | 35,250,000 | 31,500,000 |
Inventories | ' | ' |
Materials and supplies inventory | 39,800,000 | 45,800,000 |
Hydrocarbons inventory | 0 | 1,600,000 |
Restricted Cash | Facility | ' | ' |
Restricted Cash | ' | ' |
Restricted cash period required as per commercial debt facility to meet interest and commitment fee payments | '6 months | ' |
Current restricted cash | 18,600,000 | 18,600,000 |
Restricted Cash | Petroleum agreements - performance guarantees | ' | ' |
Restricted Cash | ' | ' |
Current restricted cash | 1,000,000 | 2,900,000 |
Long-term restricted cash | $35,300,000 | $31,500,000 |
Accounting_Policies_Details_2
Accounting Policies (Details 2) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||||
Variable interest entity | ' | ' | ' | ' |
Cash and cash equivalents | $621,631 | $598,108 | $508,874 | $515,164 |
Current restricted cash | 19,552 | 21,475 | ' | ' |
Prepaid expenses and other | 51,706 | 27,010 | ' | ' |
Deferred financing costs, net | 52,692 | 40,111 | ' | ' |
Accounts payable | 88,728 | 94,172 | ' | ' |
Accrued liabilities | 216,830 | 115,212 | ' | ' |
Current derivatives | 21,380 | 9,940 | ' | ' |
Other long-term liabilities | 17,689 | 20,534 | ' | ' |
Kosmos Energy Finance International | ' | ' | ' | ' |
Variable interest entity | ' | ' | ' | ' |
Cash and cash equivalents | 38,600 | 38,100 | ' | ' |
Current restricted cash | 18,600 | 18,600 | ' | ' |
Prepaid expenses and other | ' | 200 | ' | ' |
Deferred financing costs, net | 48,200 | 34,200 | ' | ' |
Accounts payable | 900 | ' | ' | ' |
Accrued liabilities | 100 | 1,400 | ' | ' |
Current derivatives | 18,000 | 9,900 | ' | ' |
Other long-term liabilities | $4,400 | $8,200 | ' | ' |
Accounting_Policies_Details_3
Accounting Policies (Details 3) (USD $) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2014 | Jun. 30, 2014 | |
Restructuring charges | $11,804,000 | $11,804,000 |
LTIP | ' | ' |
Non-cash expense included in restructuring charges | $5,000,000 | $5,000,000 |
Property_and_Equipment_Details
Property and Equipment (Details) (USD $) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | |
Oil and gas properties: | ' | ' | ' | ' | ' |
Proved properties | $837,519,000 | ' | $837,519,000 | ' | $801,348,000 |
Unproved properties | 628,688,000 | ' | 628,688,000 | ' | 524,257,000 |
Support equipment and facilities | 724,238,000 | ' | 724,238,000 | ' | 710,289,000 |
Total oil and gas properties | 2,190,445,000 | ' | 2,190,445,000 | ' | 2,035,894,000 |
Less: accumulated depletion | -639,018,000 | ' | -639,018,000 | ' | -527,832,000 |
Oil and gas properties, net | 1,551,427,000 | ' | 1,551,427,000 | ' | 1,508,062,000 |
Other property | 32,273,000 | ' | 32,273,000 | ' | 31,658,000 |
Less: accumulated depreciation | -19,296,000 | ' | -19,296,000 | ' | -16,758,000 |
Other property, net | 12,977,000 | ' | 12,977,000 | ' | 14,900,000 |
Property and equipment, net | 1,564,404,000 | ' | 1,564,404,000 | ' | 1,522,962,000 |
Depletion expense | 67,200,000 | 56,400,000 | 111,200,000 | 113,100,000 | ' |
Property and Equipment | ' | ' | ' | ' | ' |
Proceeds on sale of assets | ' | ' | 58,315,000 | ' | ' |
Gain on sale of assets | ' | ' | 23,769,000 | ' | ' |
Farm-out agreements | Essaouira Offshore Block | ' | ' | ' | ' | ' |
Property and Equipment | ' | ' | ' | ' | ' |
Participating interests (as a percent) | ' | ' | 30.00% | ' | ' |
Farm-out agreements | Foum Assaka Offshore Block | ' | ' | ' | ' | ' |
Property and Equipment | ' | ' | ' | ' | ' |
Participating interests (as a percent) | ' | ' | 29.93% | ' | ' |
Farm-out agreements | Tarhazoute Offshore Block | ' | ' | ' | ' | ' |
Property and Equipment | ' | ' | ' | ' | ' |
Participating interests (as a percent) | ' | ' | 30.00% | ' | ' |
Farm-out agreements | Cap Boujdour Offshore block | ' | ' | ' | ' | ' |
Property and Equipment | ' | ' | ' | ' | ' |
Participating interests (as a percent) | ' | ' | 55.00% | ' | ' |
BP | Farm-out agreements | Essaouira Offshore, Foum Assaka Offshore and Tarhazoute Offshore blocks | ' | ' | ' | ' | ' |
Property and Equipment | ' | ' | ' | ' | ' |
Number of blocks covered by farm-out agreements | ' | ' | 3 | ' | ' |
Proceeds on sale of assets | ' | ' | 56,900,000 | ' | ' |
Gain on sale of assets | ' | ' | 23,800,000 | ' | ' |
Cairn | Farm-out agreements | Cap Boujdour Offshore block | ' | ' | ' | ' | ' |
Property and Equipment | ' | ' | ' | ' | ' |
Reimbursement of shared costs previously incurred | ' | ' | $1,500,000 | ' | ' |
Suspended_Well_Costs_Details
Suspended Well Costs (Details) (USD $) | 6 Months Ended | |
Jun. 30, 2014 | Dec. 31, 2013 | |
project | project | |
Suspended Well Costs | ' | ' |
Capitalized exploratory well costs subsequently expensed in the same period | $2,800,000 | ' |
Reconciliation of capitalized exploratory well costs on completed wells | ' | ' |
Beginning balance | 376,166,000 | ' |
Additions to capitalized exploratory well costs pending the determination of proved reserves | 46,265,000 | ' |
Balance at the end of the period | 422,431,000 | ' |
Aging of capitalized exploratory well costs and number of projects for which exploratory well costs were capitalized for more than one year | ' | ' |
Exploratory well costs capitalized for a period of one year or less | 45,638,000 | 11,426,000 |
Exploratory well costs capitalized for a period one to two years | 171,871,000 | 229,140,000 |
Exploratory well costs capitalized for a period three to five years | 204,922,000 | 135,600,000 |
Ending balance | $422,431,000 | ' |
Number of projects that have exploratory well costs that have been capitalized for a period greater than one year | 8 | 8 |
Mahogany Discovery [Member] | ' | ' |
Projects with exploratory well costs capitalized for more than one year | ' | ' |
Number of appraisal wells | 3 | ' |
Mahogany Discovery [Member] | Maximum | ' | ' |
Projects with exploratory well costs capitalized for more than one year | ' | ' |
Submission of PoD to Ghana's Ministry of Energy, period | '6 months | ' |
Teak-1 Discovery | ' | ' |
Projects with exploratory well costs capitalized for more than one year | ' | ' |
Number of appraisal wells | 2 | ' |
Teak-1 Discovery | Maximum | ' | ' |
Projects with exploratory well costs capitalized for more than one year | ' | ' |
Submission of PoD to Ghana's Ministry of Energy, period | '6 months | ' |
Teak-2 Discovery | Maximum | ' | ' |
Projects with exploratory well costs capitalized for more than one year | ' | ' |
Submission of PoD to Ghana's Ministry of Energy, period | '6 months | ' |
Akasa Discovery | ' | ' |
Projects with exploratory well costs capitalized for more than one year | ' | ' |
Number of appraisal wells | 1 | ' |
Akasa Discovery | Maximum | ' | ' |
Projects with exploratory well costs capitalized for more than one year | ' | ' |
Submission of PoD to Ghana's Ministry of Energy, period | '6 months | ' |
Tweneboa Enyenra and Ntomme Discoveries [Member] | Maximum | Forecast | ' | ' |
Projects with exploratory well costs capitalized for more than one year | ' | ' |
Number of development wells | 24 | ' |
Wawa Discovery | Maximum | ' | ' |
Projects with exploratory well costs capitalized for more than one year | ' | ' |
Submission of PoD to Ghana's Ministry of Energy, period | '6 months | ' |
Accrued_Liabilities_Details
Accrued Liabilities (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Accrued liabilities: | ' | ' |
Accrued exploration, development and production | $130,350 | $73,976 |
Income taxes | 56,673 | 20,379 |
Accrued taxes other than income | 16,857 | 15,188 |
Accrued general and administrative expenses | 10,906 | 4,255 |
Accrued other | 2,044 | 1,414 |
Accrued liabilities | $216,830 | $115,212 |
Debt_Details
Debt (Details) (USD $) | 6 Months Ended | 6 Months Ended | ||||||||
Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Apr. 30, 2013 | Mar. 31, 2013 | Jun. 30, 2014 | Jul. 31, 2013 | |
Facility | Facility | Facility | Corporate Revolver | Corporate Revolver | Corporate Revolver | Revolving Letter of Credit Facility | Revolving Letter of Credit Facility | |||
Minimum | Maximum | item | ||||||||
Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total commitment | ' | ' | $1,500,000,000 | ' | ' | ' | $300,000,000 | $260,000,000 | ' | $100,000,000 |
Loss on extinguishment of debt | 2,898,000 | ' | 2,900,000 | ' | ' | ' | ' | ' | ' | ' |
Net deferred financing costs | 52,692,000 | 40,111,000 | 48,200,000 | ' | ' | ' | ' | ' | ' | ' |
Amount outstanding | ' | ' | 800,000,000 | ' | ' | 0 | ' | ' | ' | ' |
Undrawn availability | ' | ' | 700,000,000 | ' | ' | 300,000,000 | ' | ' | ' | ' |
Applicable margin (as a percent) | ' | ' | ' | 3.25% | 4.50% | ' | ' | ' | ' | ' |
Variable rate basis | ' | ' | 'LIBOR | ' | ' | ' | ' | ' | ' | ' |
Interval period for payment of interest | ' | ' | '6 months | ' | ' | ' | ' | ' | ' | ' |
Commitment fee percentage of the then-applicable margin when commitment is available for utilization | ' | ' | 40.00% | ' | ' | ' | ' | ' | ' | ' |
Commitment fee percentage of the then-applicable margin when commitment is not available for utilization | ' | ' | 20.00% | ' | ' | ' | ' | ' | ' | ' |
Adjustment in estimate of deferred interest | ' | ' | 4,500,000 | ' | ' | ' | ' | ' | ' | ' |
Revolving-credit sublimit amount after March 31, 2018 | ' | ' | 500,000,000 | ' | ' | ' | ' | ' | ' | ' |
Availability period of revolving-credit sublimit | ' | ' | '1 month | ' | ' | ' | ' | ' | ' | ' |
Amount outstanding under letters of credit | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' |
Other disclosures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional commitments | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000,000 |
Number of letters of credit | ' | ' | ' | ' | ' | ' | ' | ' | 7 | ' |
Restricted cash | 35,250,000 | 31,500,000 | ' | ' | ' | ' | ' | ' | 35,300,000 | ' |
Scheduled maturities of debt during the five year period and thereafter | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2018 | ' | ' | 35,812,000 | ' | ' | ' | ' | ' | ' | ' |
Thereafter | ' | ' | $764,188,000 | ' | ' | ' | ' | ' | ' | ' |
Derivative_Financial_Instrumen2
Derivative Financial Instruments (Details) | 6 Months Ended |
Jun. 30, 2014 | |
MBbls | |
Provisional Oil Sales | ' |
Derivative Financial Instruments | ' |
Volumes (in MBbl) | 973.8 |
Average price, subject to final pricing | 113.84 |
Three-way Collars | Term July 2014 to December 2014 [Member] | Price risk derivatives | ' |
Derivative Financial Instruments | ' |
Volumes (in MBbl) | 3,014 |
Weighted average net deferred premium payable per Bbl | 0.01 |
Weighted average floor price per Bbl | 88.44 |
Weighted average ceiling price per Bbl | 113.75 |
Weighted average call price per Bbl | 134.58 |
Three-way Collars | Term January 2015 to December 2015 | Price risk derivatives | ' |
Derivative Financial Instruments | ' |
Volumes (in MBbl) | 3,230 |
Weighted average net deferred premium payable per Bbl | 0.6 |
Weighted average floor price per Bbl | 87.32 |
Weighted average ceiling price per Bbl | 110 |
Weighted average call price per Bbl | 135 |
Swaps with calls | Term January 2015 to December 2015 | Price risk derivatives | ' |
Derivative Financial Instruments | ' |
Volumes (in MBbl) | 2,000 |
Weighted average swap price per Bbl | 99 |
Weighted average call price per Bbl | 115 |
Purchased Puts [Member] | Term January 2016 to December 2016 | Price risk derivatives | ' |
Derivative Financial Instruments | ' |
Volumes (in MBbl) | 2,000 |
Weighted average net deferred premium payable per Bbl | 3.41 |
Weighted average floor price per Bbl | 85 |
Derivative_Financial_Instrumen3
Derivative Financial Instruments (Details 2) (Interest Rate Swap, USD $) | 6 Months Ended |
In Thousands, unless otherwise specified | Jun. 30, 2014 |
Term July 2014 to December 2014 [Member] | ' |
Derivative Financial Instruments | ' |
Weighted Average Notional Amount | $110,555 |
Weighted Average Fixed Rate (as a percent) | 1.93% |
Floating Rate | '6-month LIBOR |
Term January 2015 to December 2015 | ' |
Derivative Financial Instruments | ' |
Weighted Average Notional Amount | 45,319 |
Weighted Average Fixed Rate (as a percent) | 2.03% |
Floating Rate | '6-month LIBOR |
Term January 2016 to June 2016 | ' |
Derivative Financial Instruments | ' |
Weighted Average Notional Amount | $12,500 |
Weighted Average Fixed Rate (as a percent) | 2.27% |
Floating Rate | '6-month LIBOR |
Derivative_Financial_Instrumen4
Derivative Financial Instruments (Details 3) (USD $) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2014 | Dec. 31, 2013 | |
Derivative instruments, Balance Sheet Location | ' | ' |
Derivatives liabilities - current | ($21,380,000) | ($9,940,000) |
Derivatives liabilities - long-term | -13,973,000 | -3,811,000 |
Not designated as hedging instruments | ' | ' |
Derivative instruments, Balance Sheet Location | ' | ' |
Total | -35,353,000 | -13,751,000 |
Commodity derivatives | Not designated as hedging instruments | ' | ' |
Derivative instruments, Balance Sheet Location | ' | ' |
Derivatives liabilities - current | -20,027,000 | -7,873,000 |
Derivatives liabilities - long-term | -13,710,000 | -3,144,000 |
Provisional oil sales contract | 3,400,000 | 0 |
Deferred premiums payable related to commodity derivative contracts | 900,000 | 100,000 |
Deferred premiums payable related to commodity derivative contracts | 7,900,000 | 6,500,000 |
Interest rate contracts | Not designated as hedging instruments | ' | ' |
Derivative instruments, Balance Sheet Location | ' | ' |
Derivatives liabilities - current | -1,353,000 | -2,067,000 |
Derivatives liabilities - long-term | ($263,000) | ($667,000) |
Derivative_Financial_Instrumen5
Derivative Financial Instruments (Details 4) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Derivative instruments, Location of Gain/(Loss) | ' | ' | ' | ' |
Amount of Gain/(Loss), derivatives not designated as hedging instruments | ($23,516) | $3,478 | ($23,112) | $2,585 |
Commodity derivatives | Derivatives, net | ' | ' | ' | ' |
Derivative instruments, Location of Gain/(Loss) | ' | ' | ' | ' |
Amount of Gain/(Loss), derivatives not designated as hedging instruments | -21,566 | 12,707 | -19,538 | 7,199 |
Commodity derivatives | Provisional Oil Sales | Oil and gas revenue | ' | ' | ' | ' |
Derivative instruments, Location of Gain/(Loss) | ' | ' | ' | ' |
Amount of Gain/(Loss), derivatives not designated as hedging instruments | -1,841 | -9,252 | -3,367 | -4,664 |
Interest rate contracts | Interest expense | ' | ' | ' | ' |
Derivative instruments, Location of Gain/(Loss) | ' | ' | ' | ' |
Amount of Gain/(Loss), derivatives not designated as hedging instruments | -109 | 23 | -207 | 50 |
Derivatives in cash flow hedging relationships | ' | ' | ' | ' |
Derivative instruments, Location of Gain/(Loss) | ' | ' | ' | ' |
Total derivatives in cash flow hedging relationships | 405 | 358 | 811 | 717 |
Derivatives in cash flow hedging relationships | Interest rate contracts | Interest expense | ' | ' | ' | ' |
Derivative instruments, Location of Gain/(Loss) | ' | ' | ' | ' |
Amount of Gain/(Loss) reclassified from AOCI into earnings | $405 | $358 | $811 | $717 |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (Recurring basis, USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Level 2 | ' | ' |
Liabilities: | ' | ' |
Total fair value, net | ($35,353) | ($13,751) |
Level 2 | Commodity derivatives | ' | ' |
Liabilities: | ' | ' |
Derivative liability, fair value | -33,737 | -11,017 |
Level 2 | Interest rate contracts | ' | ' |
Liabilities: | ' | ' |
Derivative liability, fair value | -1,616 | -2,734 |
Total | ' | ' |
Liabilities: | ' | ' |
Total fair value, net | -35,353 | -13,751 |
Total | Commodity derivatives | ' | ' |
Liabilities: | ' | ' |
Derivative liability, fair value | -33,737 | -11,017 |
Total | Interest rate contracts | ' | ' |
Liabilities: | ' | ' |
Derivative liability, fair value | ($1,616) | ($2,734) |
Equitybased_Compensation_Detai
Equity-based Compensation (Details) (USD $) | 3 Months Ended | 6 Months Ended | 37 Months Ended | 6 Months Ended | 37 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | |||||||
In Millions, except Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 |
LTIP | LTIP | LTIP | LTIP | Service Vesting Restricted Stock Awards | Market/Service Vesting Restricted Stock Awards | Market/Service Vesting Restricted Stock Awards | Market/Service Vesting Restricted Stock Awards | Service Vesting Restricted Stock Units | Market/Service Vesting Restricted Stock Units | Market/Service Vesting Restricted Stock Units | Market/Service Vesting Restricted Stock Units | Restricted Stock Awards and Restricted Stock Units | Restructuring Charges | Restructuring Charges | |
LTIP | LTIP | Minimum | Maximum | LTIP | LTIP | Minimum | Maximum | LTIP | LTIP | ||||||
LTIP | LTIP | LTIP | LTIP | ||||||||||||
Compensation agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Compensation expense recognized | $18 | $18.10 | $35.90 | $37 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $5 | $5 |
Tax benefit | 8 | 6.3 | 14.1 | 12.7 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Tax shortfall related to equity-based compensation | 6.4 | 6.9 | 6.5 | 6.9 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding unvested awards activity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at the beginning of the period (in shares) | ' | ' | ' | ' | 6,384,000 | 3,438,000 | ' | ' | 2,238,000 | 1,858,000 | ' | ' | ' | ' | ' |
Granted (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | 1,910,000 | 1,438,000 | ' | ' | ' | ' | ' |
Forfeited (in shares) | ' | ' | ' | ' | -104,000 | -33,000 | ' | ' | -343,000 | -152,000 | ' | ' | ' | ' | ' |
Vested (in shares) | ' | ' | ' | ' | -2,783,000 | ' | ' | ' | -403,000 | ' | ' | ' | ' | ' | ' |
Outstanding at the end of the period (in shares) | ' | ' | ' | ' | 3,497,000 | 3,405,000 | ' | ' | 3,402,000 | 3,144,000 | ' | ' | ' | ' | ' |
Weighted-Average Grant-Date Fair Value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at beginning of the period (in dollars per share) | ' | ' | ' | ' | $16.48 | $12.95 | ' | ' | $10.74 | $15.59 | ' | ' | ' | ' | ' |
Granted (in dollars per share) | ' | ' | ' | ' | ' | ' | $6.70 | $13.57 | $10.97 | $15.44 | $15.44 | $15.81 | ' | ' | ' |
Forfeited (in dollars per share) | ' | ' | ' | ' | $15.85 | $8.94 | ' | ' | $10.92 | $15.44 | ' | ' | ' | ' | ' |
Vested (in dollars per share) | ' | ' | ' | ' | $17.06 | ' | ' | ' | $10.85 | ' | ' | ' | ' | ' | ' |
Outstanding at the end of the period (in dollars per share) | ' | ' | ' | ' | $16.03 | $12.98 | ' | ' | $10.84 | $15.53 | ' | ' | ' | ' | ' |
Compensation expense not yet recognized | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $122.50 | ' | ' |
Weighted average period over which compensation expense is to be recognized | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year 9 months | ' | ' |
Other disclosures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares remaining available for grant | 2,200,000 | ' | 2,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Vesting percentage of the awards granted | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | 200.00% | ' | ' | ' |
Significant assumptions used to calculate fair values | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected volatility (as a percent) | ' | ' | ' | ' | ' | ' | 41.30% | 56.70% | ' | ' | 53.00% | 54.00% | ' | ' | ' |
Risk-free interest rate (as a percent) | ' | ' | ' | ' | ' | ' | 0.50% | 1.10% | ' | ' | 0.50% | 0.70% | ' | ' | ' |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Income Taxes | ' | ' | ' | ' |
Income tax expense | $80,784 | $46,253 | $131,567 | $90,344 |
Income (loss) before income taxes | 137,291 | -24,563 | 263,043 | 39,622 |
Effective tax rate (as a percent) | 59.00% | -188.00% | 50.00% | 228.00% |
Bermuda | ' | ' | ' | ' |
Income Taxes | ' | ' | ' | ' |
Income (loss) before income taxes | -6,904 | -6,663 | -12,219 | -13,440 |
United States | ' | ' | ' | ' |
Income Taxes | ' | ' | ' | ' |
Income (loss) before income taxes | 4,207 | 2,903 | 7,494 | 5,273 |
Effective tax rate (as a percent) | 193.00% | 274.00% | 128.00% | 167.00% |
Foreign-other | ' | ' | ' | ' |
Income Taxes | ' | ' | ' | ' |
Income (loss) before income taxes | $139,988 | ($20,803) | $267,768 | $47,789 |
Effective tax rate (as a percent) | ' | ' | 0.00% | ' |
Statutory tax rate (as a percent) | ' | ' | 0.00% | ' |
Ghana | ' | ' | ' | ' |
Income Taxes | ' | ' | ' | ' |
Effective tax rate (as a percent) | 36.00% | 34.00% | 36.00% | 36.00% |
Net_Income_Loss_Per_Share_Deta
Net Income (Loss) Per Share (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Numerator: | ' | ' | ' | ' |
Net income (loss) | $56,507 | ($70,816) | $131,476 | ($50,722) |
Less: Basic income allocable to participating securities | -721 | ' | -1,920 | ' |
Basic net income (loss) allocable to common shareholders | 55,786 | -70,816 | 129,556 | -50,722 |
Diluted adjustments to income allocable to participating securities | 6 | ' | 15 | ' |
Diluted net income (loss) allocable to common shareholders | $55,792 | ($70,816) | $129,571 | ($50,722) |
Weighted average number of shares used to compute net income per share: | ' | ' | ' | ' |
Basic (in shares) | 378,820,000 | 376,563,000 | 378,327,000 | 375,927,000 |
Restricted stock awards and units (in shares) | 2,998,000 | ' | 2,830,000 | ' |
Diluted (in shares) | 381,818,000 | 376,563,000 | 381,157,000 | 375,927,000 |
Net income (loss) per share: | ' | ' | ' | ' |
Basic (in dollars per share) | $0.15 | ($0.19) | $0.34 | ($0.13) |
Diluted (in dollars per share) | $0.15 | ($0.19) | $0.34 | ($0.13) |
Outstanding restricted stock awards excluded from the computations of diluted net income per share (in shares) | 4,400,000 | 14,200,000 | 4,400,000 | 14,200,000 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (USD $) | 1 Months Ended | 6 Months Ended |
Jun. 30, 2013 | Jun. 30, 2014 | |
item | ||
Operating leases | ' | ' |
Future minimum rental commitments | ' | ' |
Total | ' | $18,722,000 |
2014 | ' | 2,372,000 |
2015 | ' | 3,515,000 |
2016 | ' | 3,158,000 |
2017 | ' | 3,223,000 |
2018 | ' | 3,323,000 |
Thereafter | ' | 3,131,000 |
Atwood Achiever drilling rig contract | ' | ' |
Offshore drilling rig contract commitments | ' | ' |
Drilling rig contract period | '3 years | ' |
Initial rig rate per day | 600,000 | ' |
Optional extension period | '3 years | ' |
Number of rig slots taken by third-party | ' | 2 |
Estimated number of days of rig slots assigned to third party | ' | '150 days |
Future minimum rental commitments | ' | ' |
Total | ' | 562,870,000 |
2014 | ' | 91,035,000 |
2015 | ' | 127,925,000 |
2016 | ' | 217,770,000 |
2017 | ' | 126,140,000 |
Rig rate per day | ' | $595,000 |
Subsequent_Events_Details
Subsequent Events (Details) (Subsequent event, Senior Notes [Member], USD $) | 1 Months Ended |
In Millions, unless otherwise specified | Jul. 31, 2014 |
Subsequent event | Senior Notes [Member] | ' |
Subsequent events | ' |
Senior notes offering face amount | $300 |
Interest rate | 7.88% |
Proceeds, net of discounts, commissions and other expenses | $292.50 |