In a planned move to dump its mature shelf properties andconcentrate on new exploration opportunities, EEX Corp. is sellingits interests in nearly 100 offshore lease blocks in the shallowerwaters of the Gulf of Mexico to an undisclosed buyer for $60million. The properties contain estimated proved reserves of 58Bcfe, of which 33% are proved producing, as of Oct. 1.

The Houston-based company said it would retain the rights to itsdeeper, non-producing horizons in 10 of the blocks. By selling theproperties, EEX said it would eliminate about $26 million ofaccrued abandonment liabilities from its balance sheet with nosignificant gain or loss on the asset sale. EEX’s activities arefocused in Texas, the Gulf of Mexico and Indonesia.

“As a result of our previously announced decision to shiftcapital spending away from our mature shelf properties to onshoreprograms with higher potential return, these properties becamecandidates for sale,” said CEO Tom Hamilton. He said that eventhough the transaction exits EEX from the shallower shelf play, “wecontinue to pursue deep drilling exploration prospects on 34 shelfblocks.”

Along with the property sale, EEX announced that the GardenBanks Block 344 Well No. 3, an exploratory well on the JasonProspect, encountered hydrocarbon-bearing sands. The Greater Llanoarea, which includes the Jason Prospect, is located in watersoffshore Louisiana about 200 miles southeast of Houston.

The well was drilled to a total depth of 21,000 feet andencountered the hydrocarbons at 100 net feet of pay. EEX, whichowns 100% working interest and 80% net revenue interest, now isconsidering a sidetrack from the existing well bore or another wellelsewhere on the block.

Hamilton said that if the discovery proves to be commercial, itwould provide “another opportunity to utilize our infrastructureassets,” which include the nearby sub-sea pipeline and the EnserchGarden Banks floating production system.

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