Pogo Producing Co. said it is selling an undivided 50% of each and all of its Gulf of Mexico leasehold interests to Mitsui & Co. Ltd. and Mitsui & Co. (USA) Inc. for $500 million. Proceeds will fund the previously announced acquisition of Latigo Petroleum Inc. (see Daily GPI, April 18).
“The Latigo acquisition involves properties in the Permian Basin of west Texas and southeastern New Mexico and in the Texas panhandle area of the Anadarko Basin,” the company said. “Today’s Gulf of Mexico sale, combined with the Latigo acquisition, marks a very significant step in solidifying Pogo’s onshore North American focus.
Pogo will retain the remaining 50% interest in each of its present Gulf of Mexico properties, which will then represent, after these two transactions, slightly more than 6% of Pogo’s total proved reserves. Nevertheless, that relatively modest remaining Outer Continental Shelf presence maintains some production capacity and retains the possibility to participate, to some extent, in any significant future discovery which might be made on those offshore blocks.”
The Gulf of Mexico interests being sold represent net production of about 8,000 bbl.d of oil and 24 MMcf/d of gas. They account for about 143 Bcfe of oil and gas reserves, according to recent estimates.
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