b'KOSMOS ENERGY LTD.CONSOLIDATED STATEMENTS OF CASH FLOWS(In thousands)Years Ended December 31,2018 2017 2016Operating activitiesNet loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (93,991) $(222,792) $(283,780)Adjustments to reconcile net loss to net cash provided by operating activities:Depletion, depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . 339,214 265,407 150,608Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,145 9,505 (23,561)Unsuccessful well costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123,199 43,201 6,079Change in fair value of derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (29,960) 71,822 46,559Cash settlements on derivatives, net (including $(137.1) million and$38.7 million and $188.0 million on commodity hedges during 2018, 2017, and2016) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (137,942) 25,888 188,895Equity-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,230 39,913 40,084Gain on sale of assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7,666)Loss on extinguishment of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,324Loss on equity method investment, net / (Undistributed equity in earnings) . . . (45) 6,252 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,865 5,952 13,355Changes in assets and liabilities:(Increase) decrease in receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175,954 29,365 (20,558)(Increase) decrease in inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,848 1,653 (4,107)(Increase) decrease in prepaid expenses and other . . . . . . . . . . . . . . . . . . (18,731) (31,710) 17,557Increase (decrease) in accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . 7,440 (94,434) (75,487)Increase (decrease) in accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . (157,393) 86,595 (3,567)Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 260,491 236,617 52,077Investing activitiesOil and gas assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (213,806) (140,495) (535,975)Other property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7,935) (2,858) (1,998)Acquisition of oil and gas properties, net of cash acquired . . . . . . . . . . . . . . . . . . (961,764)Equity method investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .(231,280) Return of investment from KTIPI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 184,664Proceeds on sale of assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,703 222,068 210Net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (985,138) (152,565) (537,763)Financing activitiesBorrowings under long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,175,000 200,000 450,000Payments on long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (325,000) (250,000) Purchase of treasury stock / tax withholdings . . . . . . . . . . . . . . . . . . . . . . . . . . (206,051) (2,194) (1,981)Deferred financing costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (38,672) (67) Net cash provided by (used in) financing activities . . . . . . . . . . . . . . . . . . . . . . . 605,277 (52,261) 448,019Net increase (decrease) in cash, cash equivalents and restricted cash . . . . . . . . . . . (119,370) 31,791 (37,667)Cash, cash equivalents and restricted cash at beginning of period . . . . . . . . . . . . . 304,986 273,195 310,862Cash, cash equivalents and restricted cash at end of period . . . . . . . . . . . . . . . . . $ 185,616 $ 304,986 $ 273,195Supplemental cash flow informationCash paid for:Interest, net of capitalized interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 83,831 $ 55,381 $ 27,860Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 45,984 $ 48,815 $ 13,997Non-cash activity:Conversion of joint interest billings receivable to long-term note receivable . . . . . $$$ 9,814Contribution to equity method investment . . . . . . . . . . . . . . . . . . . . . . . . . . . $$ 133,893 $ Dissolution of equity method investment. . . . . . . . . . . . . . . . . . . . . . . . . . . . $$(122,407) $ Common stock issued for acquisition of oil and gas properties . . . . . . . . . . . . . $ 307,944 $$ See accompanying notes.109'