Kosmos Energy Ltd has indicated in its Initial Public Offering (IPO) Prospectus filed with the Securities and Exchange Commission on Thursday April 14, 2011 that it will use proceeds of the IPO to fund capital expenditure and to make a $15.0 million payment to GNPC upon the successful completion of the IPO pursuant to the settlement agreement entered into with GNPC to resolve past disputes and for general corporate purposes.

Extracts from the prospection on the use of proceeds is presented below:

" We estimate that our net proceeds from the sale of 30,000,000 common shares in this offering will be approximately $477.7 million after deducting estimated offering expenses payable by us of $5.5 million and underwriting discounts and commissions and assuming an initial public offering price of $17.00 per common share (the midpoint of the estimated public offering price range set forth on the cover of this prospectus). If the over-allotment option is exercised in full, we estimate that our net proceeds will be approximately $550.2 million.

We intend to use the net proceeds from this offering, available cash and borrowings under our commercial debt facility to fund our capital expenditures, and in particular our exploration and appraisal drilling program and development activities through early 2013, our related operating expenses, to make a $15.0 million payment to GNPC upon the successful completion of this offering pursuant to the settlement agreement we entered into with GNPC to resolve our past disputes and for general corporate purposes. See "Risk Factors--We had disagreements with the Republic of Ghana and the Ghana National Petroleum Corporation regarding certain of our rights and responsibilities under the WCTP and DT Petroleum Agreements." Management will retain broad discretion over the allocation of the net proceeds from this offering. Pending use of the net proceeds of this offering, we intend to invest the net proceeds in interest bearing, investment-grade securities.

We estimate we will incur approximately $500.0 million of capital expenditures for the year ending December 31, 2011. This capital expenditure budget consists of:

* $175.0 million for development in Ghana;

* $225.0 million for exploration and appraisal in Ghana;

* $30.0 million for exploration and appraisal in Cameroon;

* $30.0 million for new ventures to expand our license portfolio (including geological and geophysical expenses); and

* $40.0 million in unallocated funds which are available for additional drilling and licensing costs and activities.

The ultimate amount of capital we will expend may fluctuate materially based on market conditions and the success of our drilling results. Our future financial condition and liquidity will be impacted by, among other factors, our level of production of oil and natural gas and the prices we receive from the sale thereof, the success of our exploration and appraisal drilling program, the number of commercially viable oil and natural gas discoveries made and the quantities of oil and natural gas discovered, the speed with which we can bring such discoveries to production, and the actual cost of exploration, appraisal and development of our oil and natural gas assets. See "Management's Discussion and Analysis of Financial Condition and Results of Operations--Liquidity and Capital Resources."

source: [1]