Talos Makes Two Commercial Discoveries In Gulf Of Mexico
Talos Energy has made commercial quantities of oil and gas during sequential drilling operations in the U.S. Gulf of Mexico in the fourth quarter of 2022.
Talos said that its Lime Rock and Venice prospects were both commercial discoveries. The company holds a 60 percent working interest in the two deepwater discoveries, both of which are located near the Talos’ 100 percent owned and operated Ram Powell platform, where future production from both wells will flow via subsea tiebacks.
According to the company, 78 and 72 feet of net hydrocarbon pay were discovered in the primary targets at Lime Rock and Venice, respectively, with excellent geologic qualities. Talos collected pressure, fluid, and core samples from the wells to confirm the discoveries.
Expected combined gross production rates in-line with pre-drill estimates of approximately 15-20 thousand barrels of oil equivalent per day. The two wells will produce through a shared riser system at the Ram Powell facility.
Subsea tieback distance to the Ram Powell facility will be 9 miles for the Lime Rock discovery and 4 miles for the Venice discovery. Talos will collect volume-based production handling fees from non-operated partners in both discoveries.
Expected combined gross recoverable resources is in-line with pre-drill estimates of 20-30 million barrels of oil equivalent, averaging approximately 40 percent oil and 60 percent liquids. Completion of operations in expected in the second half of 2023, with first production from both wells set for the first quarter of 2024.
“I'm proud of our team for starting our deepwater drilling campaign with consecutive early successes. These two discoveries are case studies of the exciting potential that infrastructure-led development can bring in the U.S. Gulf of Mexico. For Talos, that translates to providing material production and cash flow in 2024 and beyond while reducing our operating cost structure through PHA fees and our carbon intensity through low emission subsea production.”
“Demonstrating our ability to successfully leverage existing infrastructure also reinforces the strategic merits of our pending acquisition of EnVen Energy Corporation, which will double our deepwater infrastructure footprint by adding six major facilities. Ram Powell provides a blueprint for future optimization, development, and exploration potential around those assets and our own,” Talos President and CEO Timothy S. Duncan said.
Talos claimed that the Lime Rock and Venice discoveries were representative of the company's strategy of utilizing infrastructure acquired through active business development as a cornerstone for the company's organic growth strategy.
Following its installation as the deepest production facility in the world at the time, Ram Powell produced approximately 250 million barrels of oil equivalent until Talos acquired the asset in 2018. The company then initiated numerous optimization projects that increased production rates, reduced costs, and initiated a third-party production handling agreement.
Simultaneously, Talos applied proprietary seismic reprocessing techniques to multiple recent vintage seismic surveys to identify new drilling prospects near Ram Powell, including Lime Rock and Venice.
The Lime Rock prospect was acquired in Lease Sale 256 in November of 2020 and the Venice prospect was identified within the existing Ram Powell unit acreage. Talos originally held a 100 percent working interest in both prospects prior to successful farm-downs to achieve its targeted 60 percent working interest. The company expects the Lime Rock and Venice discoveries to bring Ram Powell's production rates to levels last seen approximately 15 years ago.
Lime Rock and Venice are the first two deepwater exploitation wells in the company's current open-water rig program that started in the fourth quarter of 2022 and which will continue in the first half of 2023 with the Rigolets and Lisbon prospects, among others. Separately, Talos expects results from its operated Mount Hunter development well and its non-operated Puma West exploration well in the first quarter of 2023. The company's non-operated Pancheron exploration well is also expected to spud in the first half of 2023.
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