US-based oil and natural gas producer Talos Energy has completed the takeover of Whistler Energy II in a $52m transaction.
Whistler received $100m in cash; however, the net cash payment made by Talos stood at $14m, which represents an acquisition metric of $9,333 per net barrels of oil equivalent per day (boepd).
Talos Energy president and CEO Timothy Duncan said: “We are excited about this bolt-on transaction, as it represents exactly what we look for when buying producing assets in our core areas: low-entry costs, production facilities with unused capacity, and new seismic in a known hydrocarbon prolific area.
“We will immediately engage in a detailed field study that we expect will lead to identifying additional drilling locations on the producing asset to complement our broader portfolio in the area, providing us with optionality on how we allocate capital. We believe the Green Canyon 18 Field is a great addition to our Green Canyon core area.”
The acquired assets comprise a 100% working interest in three blocks in the Central Gulf of Mexico – Green Canyon 18, Green Canyon 60 and Ewing Bank 988, as well as a fixed production platform on Green Canyon Block 18 (GC18 production facility).
Collectively known as Green Canyon 18 Field, the Central Gulf of Mexico comprises 16,494 acres. All the leases are held-by-production.
ExxonMobil developed the Green Canyon 18 Field initially and then divested it to Whistler in 2012. This field so far has total production of more than 117 million barrels of oil equivalent.
Located nearly 18 miles north of the Talos operated Phoenix Field and Tornado discovery, the GC18 facility presently has a production capacity of 30,000boepd and 30 million cubic feet of gas a day. This facility has potential for additional expansions.
For Talos, the strategic benefit of this acquisition is far more than the existing producing leases. It had already licensed the recent vintage wide azimuth seismic data in the area. This data will be reprocessed, which will help in the re-mapping of the producing reservoirs and potentially generate further drilling prospects.
Furthermore, Talos Energy emerged as the high bidder on new leases comprising at least three drilling prospects in the latest Federal lease sale in the Gulf of Mexico that could be tied back to the GC18 production facility.