Asset/portfolio management

Beacon Completes Deepwater Gulf of Mexico Asset Sale

Independent producer divests interest in Buckskin field along with stakes in a pair of LLOG-led discoveries.

decommissioned Independence Hub deep-draft semisubmersible
The decommissioned Independence Hub deep-draft semisubmersible is being repurposed for the Salamanca development in the Gulf of Mexico.
Source: Blake Wright.

US independent operator Beacon Offshore Energy completed the divestment of its nonoperated interests in certain fields in the deepwater Gulf of Mexico under a previously executed definitive agreement with GOM 1 Holdings Inc., an affiliate of Singapore-based O.G. Oil & Gas Ltd. Financial terms of the transaction were not disclosed.

The divestment includes Beacon’s 18.7% interest in the LLOG-led Buckskin producing field, 17% interest in the LLOG-operated Leon development, 16.15% interest in the Castile development, 0.5% interest in the Salamanca FPS/lateral infrastructure, and 32.83% interest in the Sicily discovery.

“The transaction demonstrates the value Beacon has created for its shareholders through the efficient development of high-margin fields in the deepwater Gulf of Mexico and the timely monetization of these assets,” said Scott Gutterman, Beacon chairman and chief executive. “We are proud to have been able to participate alongside of our partners in the development of the divested properties since our initial acquisition of the Buckskin asset in 2017. With the completion of the divestment, we will be able to allocate 100% of our focus and resources to our deep inventory of operated properties. Driven by our existing sanctioned operated developments, including Shenandoah and Winterfell, we expect to deliver material production and cash flow growth commencing in the second quarter 2024 and continuing through 2025.”

Beacon took a final investment decision (FID) to develop Winterfell in the deepwater GOM earlier this year. The field, located in Green Canyon blocks 943, 944, 987, and 988 in a water depth of approximately 5,200 ft, will be developed as a subsea tieback to the nearby Heidelberg spar platform in Green Canyon block 860.

At the time of FID, Beacon said first oil from three initial wells was expected to begin in the second quarter this year and deliver gross production of 22,000 BOE/D.