Talos Energy Inc., Houston, Tex., and an affiliate of Ridgewood Energy Corp. have agreed to jointly acquire certain deepwater assets in the Gulf of Mexico from a subsidiary of Shell plc for $1.7 billion, subject to customary adjustments and certain contingent payments.

The transaction includes Shell Offshore Inc.'s 50% non-operated working interest in the Na Kika semi-submersible platform and associated fields, as well as its 100% interest in the Coulomb subsea tieback, Shell said in a release June 30.

Talos would acquire a 25% non-operated working interest in the bp plc-operated (50%) Na Kika platform and the Kepler, Ariel, Fourier, and Herschel fields, along with a 50% working interest and operatorship in the Coulomb field, the company said in a separate release.

The Na Kika interests are subject to a 30-day preferential purchase right held by affiliates of bp. According to bp's website, Na Kika is one of bp’s "most prolific producers in the Gulf," as a hub for 8 subsea fields with more than 100 miles of infield flowlines which make up the gathering system. Na Kika, which lies 140 miles southeast of New Orleans in 6,340 ft of water, is designed to process up to 130,000 b/d of oil and 550 MMcfd of natural gas.

If exercised, Talos would acquire only the 50% working interest and operatorship in Coulomb field, Talos said.

Shell's entitlement production from the assets is expected to average 37,000 boe/d in 2025. The company reported proved reserves at year-end 2025 of 4.3 MMboe for Na Kika and 7.2 MMboe for Coulomb. Based on its internal modeling, Na Kika and Coulomb "will not be meaningful contributors to production by 2030," Shell said.

Average first-quarter 2026 production attributable to the interests Talos expects to acquire was about 16,000 boe/d, of which about 77% was oil, Talos said.

What Shell retains

The agreement includes a 50% upside-sharing arrangement with Shell from closing through year-end 2027, subject to commodity price thresholds and certain other contingencies. The arrangement applies if realized oil prices exceed $60/bbl, Talos said.

According to Shell, it will receive uncapped upside-linked payments through 2027 and overriding royalty interests on production from future Na Kika tiebacks, subject to specified conditions.

Shell Trading US Co. will retain rights to offtake production from Na Kika and Coulomb under negotiated agreements with Talos and Ridgewood, Shell said.

The deal is expected to close by year-end 2026, subject to customary conditions and the expiration or waiver of bp's preferential purchase rights on the applicable Na Kika interests. Upon closing, Talos and Ridgewood would assume certain decommissioning obligations.