Energy XXI to buy Gulf of Mexico fields from Pogo

Energy XXI (Bermuda) Ltd. has agreed to purchase certain Gulf of Mexico oil and natural gas properties from Pogo Producing Co. for $419.5 million cash and the assumption of debt.

By OGJ editors
HOUSTON, Apr. 25 -- Energy XXI (Bermuda) Ltd. has agreed to purchase certain Gulf of Mexico oil and natural gas properties from Pogo Producing Co. for $419.5 million cash and the assumption of debt. The transaction is expected to close by June 1.

The properties—nearly 282,000 gross acres (91,600 net) containing 28 fields— have proved reserves of about 20 million boe net, with 70% oil. These fields currently produce about 7,400 boe/d net, with 62% oil.

On a reserves basis, 73% of the properties are operated, and 74% of the reserves are proved developed.

The upside potential of the properties are expected to be more than 1,500 boe/d net as production is restored at hurricane-affected facilities and the company drills the inventory of identified development and exploration locations, said Energy XXI Chairman and Chief Executive John Schiller.

Future development costs could be as much as $188.8 million.

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