UK-based Leni Gas and Oil (LGO) has announced the sale of its interests in two exploration leases in the US Gulf of Mexico to Byron Energy for a total consideration of $400,000.
The sale of its 20% interest in South Marsh Island-6 and Ship Shoal-180 is expected to be completed on acceptance of the assignment of the leases by the US Bureau of Ocean Management.
LGO exercised its option under the Strategic Scouting Agreement with Byron in 2010 to participate in the Leases, which Byron won in Gulf of Mexico Lease Sale 213.
The company has capitalised the acquisition costs and rental fees at $212,000, as no seismic or drilling activity was undertaken on the leases.
Neil Ritson, Leni Gas and Oil chief executive, said that the sale continues the company’s plan to refocuse on Trinidad. "These exploration opportunities in the shallow water Gulf of Mexico were non-core to the company’s onshore production growth," Ritson said.
"The funds will be reinvested in Trinidad through the recompletion of two existing oil production wells at Moruga North and the drilling of the first of our three farm-in wells. We also expect shortly to have further news for shareholders on our planned divestment in Spain."
Proceeds from the sale will be invested in the Moruga North Field located in Trinidad, where development activities were plagued by title defects in some of the petroleum rights leases.
Work is expected to begin in the two months, following the remediation measures to rectify the earlier issues.