Energy XXI to Earn 20% in GOM Exploration Well

Energy XXI (Bermuda) Ltd said it has entered into a deal with McMoRan Exploration Company (MMR) to earn a 20 percent working interest in the South Timbalier Block 168 No. 1 exploration well, in the relatively shallow waters of the Gulf of Mexico shelf.

The company said it will pay up to $5.5 million for the right to participate in the re-entry of South Timbalier Block 168 and for a share of the additional acreage.

Current Blackbeard West participants include MMR -- the operator -- with a 32.3 percent working interest, Energy XXI with 20 percent and Plains Exploration Company with 35 percent, it added.

Energy XXI said it has begun drilling or had scheduled within the next few months to spud six prospects with net unrisked reserves potential totalling nearly 50 million barrels of oil equivalent, adding the volumes for third quarter ended March 31 are estimated to have averaged more than 26,000 barrels of oil equivalent per day.