W&T Offshore Inc. closed its acquisition of interests in and operatorship of oil and gas producing properties in the Gulf of Mexico from Exxon Mobil Corp. for $167.6 million in cash.
The acquired properties are in the eastern region of the Gulf of Mexico, offshore Alabama. The assets also include onshore and offshore facilities and pipelines, as well as working interests in nine Gulf of Mexico offshore producing fields and an onshore treatment facility adjacent to W&T Offshore's existing properties.
The acquisition adds an estimated 74 million barrels of oil equivalent of net proved reserves, 99% of which are proved developed producing and 22% are liquids, as of the effective date of Jan. 1. The assets also produced about 19,800 net boe/d, 25% liquids, in the first quarter. The deal positions W&T Offshore as the largest operator in the area, the oil and gas producer said in the release.
The deal consideration includes a previously funded $10 million deposit. W&T Offshore used cash on hand and revolver debt to fund the acquisition.
Separately, W&T Offshore was named the apparent high bidder on two shallow-water blocks in the Gulf of Mexico Outer Continental Shelf during a region-wide oil and gas lease sale held by the Bureau of Ocean Energy Management on Aug. 21.
If awarded, the company would pay about $300,000 for the leases, representing a 100% working interest and a royalty rate of 12.5%. The two blocks cover about 10,300 acres and have a five-year lease term.
