Stone Energy Corporation Announces Close of Acquisition of BP's Pompano Field Working Interest

abarrelfullabarrelfull wrote on 29 Dec 2011 08:49
Tags: bp deals gulf-of-mexico stone upstream usa


Stone Energy Corporation (NYSE: SGY) today announced the closing of the previously announced acquisition of deep water assets from BP Exploration & Production Inc. (BP), which include BP's 75% operated working interest in the five block deep water Pompano field in Mississippi Canyon, a 51% operated working interest in the adjacent Mississippi Canyon block 29, a 50% non-operated working interest in the Mica field, which ties back to the Pompano platform, and interests in 23 deep water exploration leases located in the vicinity of the Pompano field.

The stated purchase price of $204 million was adjusted under the agreement to $167.6 million, after adjusting for the effective date of July 1, 2011. The final purchase price is subject to further adjustments for the subsequent period through the closing date. The acquisition was funded from cash on hand and $45 million in borrowings under Stone's revolving bank credit facility. Following the completion of the closing on December 28, 2011, Stone had $45.0 million in bank borrowings and $61.1 million in letters of credit outstanding under its bank credit facility, with availability of $293.9 million under its bank credit facility.

Stone's preliminary review of the estimated proved reserves relating to the acquired properties indicated estimated proved reserves of approximately 17 million barrels of oil equivalent (Boe) as of December 28, 2011, which were approximately 83% oil. Stone's preliminary estimate of the asset retirement obligation associated with the properties is approximately $60 million. The Pompano platform is a production hub with seven producing leases, currently producing at an average rate of approximately 3,300 Boe per day, net to Stone. The production hub has production capacity of 60,000 barrels of oil per day and 135 million cubic feet of gas per day, which could allow for potential processing of additional third party production.


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