# Fellow Shareholders

_Source: `DeepSeekOCR_Ardian_pruned_1k/energy-oil-gas-e-p/NYSE_KOS_2022/NYSE_KOS_2022.mmd` · pages 2-8_

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Fellow Shareholders,

As the world grapples with the need for affordable, secure, and cleaner energy – particularly in the wake of Russia's war in Ukraine – I am confident that Kosmos has the right strategy and portfolio to be a part of the solution.

Kosmos has a strong oil-weighted portfolio that can supply more of the energy the world needs today. We are investing in growing oil supply at each of our core production hubs, with an emphasis on high-graded projects that yield low cost, lower carbon barrels that are highly cash generative. At the same time, we are working with our partners to bring new sources of lower carbon natural gas into production. These projects address energy affordability and increase energy security by supplying more gas to global energy markets, as well as to domestic markets in Africa.

By 2024, we expect to increase production by about 50% compared to 2022 levels as we optimize current production and bring new projects online. For Kosmos, the cash flow from current and planned activities enables selective re-investment into the most compelling opportunities in our portfolio, which can help meet demand and support the energy transition for decades to come. Longer term, we plan to continue shifting the balance of our portfolio from oil to natural gas and LNG to help meet the world's energy needs as cleaner natural gas displaces coal, heavy fuel oil, and biomass as primary sources of energy in both developed and emerging economies.

## DELIVERING ON OUR STRATEGY

In 2022, Kosmos delivered strong operational and financial performance in support of this strategy. In addition to solid production rates that generated significant free cash flow, we advanced our three major development projects and further strengthened our balance sheet, ending the year with more than $1 billion in liquidity and leverage below our 1.5x target. Looking ahead, Kosmos expects to reach an important inflection point in the second half of 2023 with production expected to grow as major development projects start to come online and capital expenditures begin to fall. With higher production and lower capital, free cash flow is expected to rise into 2024 providing multiple pathways for the company to deliver value for our shareholders.

As we pursue our strategy, we continue to be guided by our commitment to sustainability. With our low cost, lower carbon oil and gas production, Kosmos aims to be a responsible producer that the world can count on to balance energy security and affordability with the need to lower emissions. In early 2020, we set the goal to become carbon neutral for our operated Scope 1 and Scope 2 emissions by 2030 or sooner. We achieved this goal in both 2021 and 2022, and we remain committed to maintaining it. We are also working with our partners and host governments on projects to reduce the carbon intensity of our non-operated production assets, such as the elimination of routine flaring in Ghana and Equatorial Guinea. We also plan to disclose equity emissions and new targets in this year's Sustainability Report. Our commitment to ESG and sustainability is a core value that has been recognized by stakeholders. MSCI, one of the leading ESG ratings agencies, recently awarded Kosmos its highest possible "AAA" rating, which puts us in the top 20% of companies across the sector.

## LOOKING AHEAD

Kosmos offers investors access to a high-quality reserve base, with unique exposure to world-scale LNG projects, alongside a portfolio of low cost, lower carbon oil opportunities through infrastructure-led exploration. These opportunities underpin sustainable and value-accretive growth. We look forward to further delivering on our strategy, creating value for our shareholders and bringing affordable, secure, and cleaner energy to the world.

On behalf of the entire board of directors, I thank you for your participation and investment in our company.

Sincerely yours,

![](images/2_1.jpg)

ANDREW G. INGLIS
Chairman of the Board of Directors
and Chief Executive Officer