W&T Offshore, a U.S. Gulf of Mexico-focused oil and gas company, has finalized the acquisition of interests in eight shallow water oil and gas producing assets from an undisclosed private seller. These assets are located in the central and eastern shelf region of the Gulf of Mexico.
The acquired assets encompass 30,646 gross acres (22,079 net acres) and are currently producing around 2,400 barrels of oil equivalent per day, with 42% being oil. As of June 1, 2023, the estimated proved reserves for these properties totaled 3.2 million barrels of oil equivalent (49% oil), all of which are proved developed. Additionally, the 2P (proved and probable) reserves for these assets are estimated to be 5.1 million barrels of oil equivalent (48% oil).
The gross consideration for the acquisition was $32 million, with payment made using W&T's cash on its balance sheet. These assets complement W&T Offshore's existing operations, with water depths ranging from 25 to 265 feet and an average working interest of approximately 72%.
Tracy W. Krohn, Chairman, President, and CEO of W&T Offshore, noted that these assets met their investment criteria, with strong production rates, positive free cash flow, proved developed reserves, and identified upside potential. The company also sees opportunities to reduce operating costs and enhance free cash flow.
Krohn emphasized that acquisitions have been instrumental in the company's growth strategy, and they remain well-positioned to seize further opportunities that enhance their portfolio and provide value to shareholders.