Helix Energy Solutions Group Inc. on Monday upped its earnings guidance 23% for the year after completing its $1.4 billion acquisition of Remington Oil & Gas. Helix, also citing strength in its contracting services businesses, now expects earnings of $3.20-3.70/share in 2006. On May 2, the company forecast 2006 earnings of $2.70-3.30.

“We are extremely pleased to have closed the Remington transaction, which is immediately accretive to earnings and provides a pipeline of high quality prospects to help fuel future growth,” said CEO Owen Kratz in a statement. In 2007, he said, Helix is anticipating earnings growth of 15-60%, with earnings of $4.00-5.50/share. “We should generate over $1.5 billion of operating cash flow from now until the end of 2007, which will allow us to pursue exciting growth opportunities in the contracting services segment; enhance reserves and production; and reduce debt, as well as fund share repurchases.

Helix, formerly Cal Dive International, was mostly known as a subsea contractor before the Remington acquisition was announced in January (see Daily GPI, Jan. 24). At year-end 2005, Remington had about 280 Bcfe of proved reserves (unaudited) and identified prospects with risked reserves of more than 1,100 Bcfe. Last October, Forbes magazine ranked Remington No. 4 on its list of the “200 Best Small Companies” — the only producer to make it into the Top 10.

Most of Remington’s prospects are on the Outer Continental Shelf, with some deepwater prospects. Its present mix is 63% natural gas and 37% oil. Before the acquisition was announced, Remington had estimated its 2006 production would total 45-49 Bcfe. Last December, Cal Dive forecast its 2006 output to be nearly identical: 44-47 Bcfe. All of Cal Dive’s production is in the Gulf; Remington also holds assets along the Gulf Coast.

Helix’s board of directors also has approved a buyback of up to $50 million of its common shares in the open market. On July 18, Helix will transfer its listing from the Nasdaq and begin trading on the New York Stock Exchange (NYSE) under the ticker symbol “HLX.” As a result of the merger, each share of Remington common stock has been converted into the right to receive $27.00 in cash and 0.436 shares of Helix common stock.

“With respect to the NYSE transfer, this is a move we have contemplated for some time,” said Kratz. “With the name change earlier this year and the closing of the Remington acquisition, a NYSE listed company, the timing is right. We are greatly appreciative of the support we have received from NASDAQ; however, we believe that this is the right move at the right time for our company and shareholders.”

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