Houston-based Plains Exploration & Production Co. reported Friday that it has completed the separate acquisitions of Gulf of Mexico (GOM) properties owned by BP Exploration & Production Inc., BP America Production Co. and Shell Offshore Inc. for a combined total of $6.1 billion.

Announced in September (see Daily GPI, Sept. 11), the producer paid $5.55 billion to the BP companies for deepwater GOM oil and gas properties that include the BP-operated Marlin, Dorado and King fields (collectively the Marlin Hub, 100% working interest), BP-operated Horn Mountain field (working interest 100%), BP-operated Holstein field (working interest 50%), BP nonoperated Diana-Hoover Field (33.33% working interest, operated by ExxonMobil Corp.) and BP nonoperated Ram Powell field (31% working interest, operated by Shell Offshore Inc.).

At the end of July the properties were producing an estimated 59,500 boe/d, of which nearly 84% was oil and natural gas liquids (NGL) with an average American Petroleum Institute gravity of 34 degrees.

Separately, Plains paid $560 million to Shell Offshore for its 50% working interest in the Holstein Field, giving it a 100% working interest in the field when combined with the BP acquisition.

At the end of July the properties were producing an estimated net 7,400 boe/d, of which nearly 86% was oil and NGLs with an average American Petroleum Institute gravity of 33 degrees.

During a September conference call with financial analysts, Plains CEO James Flores said the two acquisitions were another step in the producer’s conversion to a heavily oil-focused company, a transition it began three years ago. Both transactions were funded with borrowings under Plains’ senior secured revolving and term loan credit facility and net proceeds from the senior notes issued in October 2012.

The announced completion of the deals put a positive spin on an otherwise difficult week for Plains. The company’s stock drifted to a recent low of $32.47/share on Tuesday on news that McMoRan Exploration Co. was still having trouble bringing the prospective Davy Jones natural gas discovery in the shallow waters of the GOM online (see Daily GPI, Nov. 28). Plains reported in October that it still owned 51 million shares of McMoRan, representing a stake of about 31.5%. PXP acquired the stake two years ago (see Daily GPI, Sept. 21, 2010).

The dip proved to be short-lived for Plains, which saw its shares trade north of $36 on Friday.

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