Helix Energy Solutions Group, Inc. has closed the previously announced sale of Energy Resource Technology GOM, Inc. (ERT), the Company’s oil and gas subsidiary, to Talos Production LLC, a wholly owned subsidiary of Talos Energy LLC, a privately held Houston-based oil and gas company.
Proceeds from the transaction were approximately $620 million in cash, as well as overriding royalty interests in ERT’s successful Wang discovery and certain exploration prospects. Jeffries & Company, Inc. served as the exclusive financial advisor to Helix in conjunction with the transaction.
A portion of the cash proceeds from the sale of ERT will be used to repay the Company’s term loans and revolving credit facility indebtedness as required by the governing credit agreement.
Owen Kratz, President and Chief Executive Officer of Helix, stated that “the sale of ERT is an important milestone in the Company’s previously announced strategic plans to grow its Well Intervention and Robotics businesses.”
- Talos Buys Energy Resource Technology (pehub.com)
- Helix Energy (HLX) to Divest Energy Resource Tech in ~$700M Deal (streetinsider.com)
- Helix Energy sells oil and gas subsidiary to Talos (bizjournals.com)
Apache Corporation announced it was the high bidder on 90 shelf and deep water blocks in the Central Gulf of Mexico offshore lease sale held by the Bureau of Ocean Energy Management (BOEM) in New Orleans.
Of the 56 companies submitting bids for Gulf of Mexico acreage, Apache Corp. was ranked No. 1 overall for its 61 high bids on the shelf, while Apache Deepwater LLC, the company’s deep water arm, was ranked No. 4 overall with 29 high bids.
The sum of the combined high bids was nearly $96 million gross.
“We’re excited about these blocks and our expanding presence in the Gulf of Mexico,” said G. Steven Farris, Apache chairman and chief executive officer. “The Gulf of Mexico is integral to Apache’s long-term growth. The shelf provides some of the best margins, highest returns and most free cash flow, and the deep water has some of the best exploration potential of any region in our global portfolio.”
Bidding on acreage in the shelf was focused on areas where Apache is acquiring proprietary seismic data, along with moderate to deep exploration prospects based on recently acquired and reprocessed seismic data. Successful deep water bids were focused on Pliocene and Miocene trends where Apache has acquired a significant seismic data base. Deep water bid partners included Stone Energy, Samson, Noble, Repsol, Nexen and Ecopetrol.
“This was a very robust lease sale with premium acreage,” said Jon Jeppesen, executive vice president of Apache’s Gulf of Mexico regions. “These blocks strengthen our position on the shelf and in the deep water. In both areas, Apache has the fiscal wherewithal, technical prowess and experience to capture the value of these opportunities.”
The shelf and deep water Gulf of Mexico currently represents 15.5 percent of Apache’s overall daily production.
- Republicans: Obama taking too much credit for Gulf lease sale (fuelfix.com)
- USA: API Upstream Director Calls for Expanded Five-Year Offshore Plan (mb50.wordpress.com)
- Maersk Bags Gulf of Mexico Contract for Its Under-Construction Drillship (mb50.wordpress.com)
- No relief for natural gas producers as Apache’s Kitimat plant delayed (mb50.wordpress.com)
Yesterday, the Department of the Interior took the latest step as part of President Obama’s all-of-the-above energy strategy to expand safe and responsible domestic energy production, holding a 39 million acre lease sale in the Gulf of Mexico.
Secretary of the Interior Ken Salazar announced that the Central Gulf of Mexico oil and gas lease sale attracted $1,704,500,995 in high bids for tracts on the U.S. outer continental shelf offshore Louisiana, Mississippi and Alabama. A total of 56 offshore energy companies submitted 593 bids on 454 tracts covering more than 2,402,918 acres. The sum of all bids received totaled $2,602,563,726.
The lease sale builds on a series of actions taken by the Obama administration, including additional lease sales for both onshore and offshore areas for oil and gas development, to meet the President’s direction to continue to expand safe and responsible production of America’s important domestic resources.
“This sale, part of the President’s all-of-the-above energy strategy, is good news for American jobs, good news for the Gulf economy, and will bring additional domestic resources to market,” said Salazar, who opened the sale. “When it comes to domestic production, the President has made clear he is committed to expanding oil and natural gas production safely and responsibly, and today’s sale is just the latest example of his administration delivering on that commitment. The numbers speak for themselves: every year the President has been in office, domestic oil and gas production has increased, foreign imports of oil have decreased, and we are currently producing more oil than any time in the past eight years.”
The Central Gulf of Mexico Lease Sale 216/222, conducted by the Bureau of Ocean Energy Management (BOEM), offered more than 39 million acres for oil and gas development on the U.S. Outer Continental Shelf. The acreage included 7,434 tracts from three to more than 230 miles off the coast, in depths ranging from 10 to more than 11,200 feet (3 to 3,400 meters). BOEM estimates the economically recoverable hydrocarbons that could be produced as a result of the acreage offered ranges from 0.8 to 1.6 billion barrels of oil and 3.3 to 6.6 trillion cubic feet of natural gas.
The sale builds on the successful Western Gulf of Mexico lease sale held by BOEM in December 2011 that made available more than 21 million acres – equal to an area the size of South Carolina – and attracted more than $337 million in high bids and included 20 companies submitting 241 bids on 191 tracts comprising over a million acres offshore Texas. In 2010, DOI offered nearly 37 million offshore acres to industry for oil and gas leasing.
“Before moving forward with Sale 216/222, we conducted a rigorous analysis of the environmental effects of the Deepwater Horizon oil spill on the Central Gulf of Mexico,” said BOEM Director Tommy P. Beaudreau. “We have also continued a number of lease terms designed to ensure fair return to the American people and provide innovative incentives to promote diligent development of our nation’s offshore oil and gas resources.”
Yesterday’s highest bid on a tract was $157,111,000 submitted by Statoil Gulf of Mexico LLC for Mississippi Canyon, Block 718. Shell submitted the highest total amount in bonus bids, $406,594,560 on 24 tracts.
Lease terms for both sales included escalating rental rates to encourage faster exploration and development of leases as well as shorter lease terms for shallower water in order to encourage timely development. BOEM has increased its minimum bid requirement in deepwater to $100 per acre, up from $37.50 in previous Central lease sales. Rigorous historical analysis showed that leases that received high bids of less than $100 per acre have experienced virtually no exploration and development activities.
Lessees will have to comply with a series of important environmental stipulations, including requirements to protect biologically sensitive features, as well as marine mammals and sea turtles, and employ trained observers to ensure compliance and restrict operations when conditions warrant. These terms will help ensure an appropriate balance of responsible resource development with protection of the human, marine and coastal environments.
Each high bid on a tract will now go through a strict evaluation process within BOEM to ensure the public receives fair market value before a lease is awarded. This is the final Gulf Lease Sale scheduled in the current Outer Continental Shelf Oil and Gas Leasing Program: 2007-2012.
- USA: API Upstream Director Calls for Expanded Five-Year Offshore Plan (mb50.wordpress.com)
Engineering and construction company Clough Limited announced that it has completed the sale of its Marine Construction business to SapuraCrest Petroleum Berhad for gross proceeds of approximately AUD 127 million and on the terms previously reported in the company’s ASX Announcement of 8 August 2011.
Clough’s offshore Marine Construction Division includes the derrick lay barge, Java Constructor, and associated marine construction equipment. Also included will be Clough’s interest in the Clough Helix Joint Venture, which operates the chartered Normand Clough vessel, and its investments in specialist engineering businesses, OFI and Peritus. Relevant contracts including the Chevron Gorgon Domestic Gas pipeline project are proposed to be novated.
Post transaction the division will continue to operate from Perth with a continuing focus on both the Australian and regional markets. Clough will continue to provide a number of back office services to the business for a period of two years.
Established in 1919, Clough delivers an integrated Engineering, Procurement and Construction service to oil and gas and mineral resources projects primarily in Australia and South East Asia. The Group’s services range from concept development through design, construction, installation, commissioning, operations and maintenance.
Backed by an experienced management team, over 3,600 personnel and sophisticated project management systems, we are recognised for our commitment to safety, sustainable development and the wellbeing of the people, communities and environments in which we operate.
Cheniere Energy Partners, L.P. announced today that its subsidiary, Sabine Pass Liquefaction, LLC, has entered into its first liquefied natural gas (LNG) sale and purchase agreement (SPA) with BG Gulf Coast LNG, LLC (BG), a subsidiary of BG Group plc, under which BG has agreed to purchase 3.5 million tonnes per annum (mtpa) of LNG.
Sabine Liquefaction is planning to develop the ability to produce 9 mtpa of LNG in the first phase of its project at the Sabine Pass Terminal owned by Cheniere Partners. On May 20, 2011, Sabine Liquefaction received authorization from the U.S. Department of Energy to export up to 16 mtpa of LNG destined to all countries with which trade is permissible.
Under the agreement, BG will pay Sabine Liquefaction a fixed sales charge for the full annual contract quantity and will also pay a contract sales price for LNG purchases based on the applicable Henry Hub index traded on the New York Mercantile Exchange. LNG will be loaded onto BG’s vessels. The SPA has a term of twenty years commencing upon the date of first commercial delivery, and an extension option of up to ten years. LNG exports are expected to commence as early as 2015. The SPA is subject to certain conditions precedent, including but not limited to Sabine Liquefaction’s receiving regulatory approvals, securing necessary financing arrangements and making a final investment decision to construct the liquefaction facilities.
“BG is one of the largest participants in the global LNG markets and will be a strong foundation customer for our Sabine Pass liquefaction project,” said Charif Souki, Chairman and CEO. “Entering into this agreement is a significant milestone for our project and we look forward to finalizing additional commercial agreements and proceeding with the development of the first two trains.”
- LNG Demand East of Suez Expected to Surge (mb50.wordpress.com)
- GDF Suez Sees Strong China LNG Demand (mb50.wordpress.com)
- InterOil, Pacific LNG sign supply deal with Noble Clean Fuels (mb50.wordpress.com)
- Petronet in Talks to Buy Capacity at US, Australia LNG Terminals (mb50.wordpress.com)
- USA: Wartsila Wins LNG Propulsion Equipment Contract for Offshore Vessels (mb50.wordpress.com)
- Cheniere Energy Shares Popped: What You Need to Know (fool.com)
Hercules Offshore, Inc. and Seahawk Drilling, Inc. announced the completion of the asset purchase and sale previously disclosed on February 11, 2011.
In accordance with the terms of the Asset Purchase Agreement, Hercules Offshore will acquire 20 jackup rigs located in the U.S. Gulf of Mexico and related assets, accounts receivable, cash, accounts payables, and certain contractual rights from Seahawk Drilling.
The total consideration paid to Seahawk Drilling consists of approximately 22.3 million shares of Hercules Offshore common stock and $25.0 million in cash. Following this transaction, there will be a total of approximately 137.2 million outstanding shares of Hercules Offshore, Inc.