# Fellow Shareholders

_Source: `DeepSeekOCR_Ardian_pruned_1k/energy-oil-gas-e-p/NYSE_KOS_2021/NYSE_KOS_2021.mmd` · pages 2-8_

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Fellow Shareholders,

Just as we were looking forward to the resurgence of the global economy after the difficult years of the pandemic, Russia's invasion of Ukraine has shocked the world and illustrated the fragility of the peace and democracy we hold so dear. The tragic loss of life, the displacement of millions of people, and the economic devastation will cast a long shadow.

For the energy sector, the conflict is re-shaping the industry's outlook. At the most basic level, it has reminded the world of the need to pursue the energy transition while ensuring energy security. Europe's reliance on Russia highlights the need for new sources of energy, ultimately renewables with hydrocarbons playing a long-term role in the transition. Kosmos can play a role in meeting that challenge with a portfolio of low cost, lower carbon oil production, and low cost, lower carbon liquified natural gas (LNG) projects offshore Mauritania and Senegal, which are poised to bring a new source of gas to the world as soon as production starts late next year. By sourcing LNG from Mauritania and Senegal, Europe would enhance its energy security and help these countries meet their own development goals – a positive and necessary outcome for all involved. For Kosmos, this illustrates our role in bringing a just and secure energy transition to life, and 2021 was a productive year for the company in fulfilling that vision.

We rebuilt operational momentum across the portfolio with a return to drilling in Ghana, Equatorial Guinea, and the Gulf of Mexico. This increased activity helped push net production above our year-end exit target of 75,000 barrels of oil equivalent per day. Importantly, this increased production boosted free cash flow and reduced leverage to around 2.5 times at year-end. Our LNG development offshore Mauritania and Senegal made significant progress with Greater Tortue Ahmeyim Phase 1 around 70% complete at year end. In addition, Kosmos executed a highly accretive transaction in Ghana, acquiring additional interests in the Jubilee and TEN fields, which has helped transform the balance sheet and further increase free cash flow generation.

As we executed the company's strategy in 2021, we continued to be guided by our long-standing commitment to sustainability. Our most recent TCFD-aligned Sustainability Report advances the approach we introduced last year and covers our full ESG agenda, including the actions we have taken to mitigate climate-related risks and enhance the resilience of our business. Given the importance of ESG performance, the data in our most recent report has been reviewed by our independent auditor. This is an added step we have taken to increase confidence in our reporting, further demonstrating our commitment to transparency and openness.

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The outlook for Kosmos in 2022 and beyond remains positive. The company is underpinned by low-cost, lower carbon assets – world class fields that have the longevity to deliver sustainable, high-margin cash flow at current prices. With our existing assets and sanctioned projects, production is expected to grow around 50% in the next two years, with a growing natural gas weighting at a time when there is a need for new sources of gas. With growing production and a strong commodity price backdrop, we expect to make further progress de-leveraging the balance sheet, with a year-end 2022 leverage target of around 1.5 times at current prices. As we deliver on this plan and new projects start up, sustainable free cash flow is expected to increase materially, creating the potential for meaningful shareholder returns.

Kosmos has emerged from the last two years of the pandemic with a stronger business and an important role to play in supporting the energy transition and strengthening energy security. We are excited about the future.

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

Sincerely yours,

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ANDREW G. INGLIS
Chairman and Chief Executive Officer