W&T Offshore Provides Updates on Recent Developments
W&T Offshore (NYSE: WTI) announced several key operational updates. The company signed a PSA to sell its non-core interest in Garden Banks Blocks 385/386, producing 195 Boe/d, for $12.3 million. Two major field developments are expected to resume production: West Delta 73 field by mid-Q2 2025, and Main Pass 108/98 fields by early Q2 2025, with the latter previously producing 6.1 MMcfe/d before being shut-in.
The company will receive a $58.5 million insurance settlement in January 2025 for a casualty loss at Mobile Bay 78-1 well. The recently announced Presidential ban on new offshore drilling will not impact WTI's operations. The Garden Banks sale, effective December 1, 2024, will affect year-end 2024 reserves by approximately 0.12 million barrels of oil equivalent.
W&T Offshore (NYSE: WTI) ha annunciato diversi aggiornamenti operativi chiave. L'azienda ha firmato un PSA per vendere il suo interesse non strategico nei Garden Banks Blocks 385/386, che producono 195 Boe/d, per 12,3 milioni di dollari. Due importanti sviluppi di campo sono previsti per riprendere la produzione: il campo West Delta 73 entro metà del secondo trimestre del 2025 e i campi Main Pass 108/98 all'inizio del secondo trimestre del 2025, con quest'ultimo che in precedenza produceva 6,1 MMcfe/d prima della chiusura.
L'azienda riceverà un risarcimento assicurativo di 58,5 milioni di dollari a gennaio 2025 per una perdita accidentale nel pozzo Mobile Bay 78-1. Il recente divieto presidenziale su nuove attività di trivellazione offshore non influenzerà le operazioni di WTI. La vendita dei Garden Banks, effettiva dal 1° dicembre 2024, influenzerà le riserve di fine anno 2024 di circa 0,12 milioni di barili di equivalente petrolifero.
W&T Offshore (NYSE: WTI) anunció varias actualizaciones operativas clave. La compañía firmó un PSA para vender su interés no central en los Garden Banks Blocks 385/386, que producen 195 Boe/d, por 12,3 millones de dólares. Se esperan dos importantes desarrollos en el campo para reanudar la producción: el campo West Delta 73 a mediados del segundo trimestre de 2025 y los campos Main Pass 108/98 a principios del segundo trimestre de 2025, siendo este último que anteriormente producía 6,1 MMcfe/d antes de ser cerrado.
La compañía recibirá un pago de indemnización de 58,5 millones de dólares en enero de 2025 por una pérdida por accidente en el pozo Mobile Bay 78-1. La reciente prohibición presidencial de nuevas perforaciones en alta mar no afectará las operaciones de WTI. La venta de Garden Banks, efectiva a partir del 1 de diciembre de 2024, afectará las reservas de fin de año 2024 en aproximadamente 0,12 millones de barriles de equivalente de petróleo.
W&T Offshore (NYSE: WTI)는 여러 중요한 운영 업데이트를 발표했습니다. 회사는 195 Boe/d를 생산하는 Garden Banks Blocks 385/386에 대한 비핵심 지분을 1,230만 달러에 판매하기 위한 PSA에 서명했습니다. 두 개의 주요 유전 개발이 생산을 재개할 것으로 예상됩니다: West Delta 73 유전은 2025년 2분기 중반에, Main Pass 108/98 유전은 2025년 2분기 초에 재개될 예정이며, 후자는 이전에 하루에 6.1 MMcfe를 생산했습니다.
회사는 Mobile Bay 78-1 유정에서의 사고 손실에 대해 2025년 1월에 5,850만 달러의 보험 배상금을 받을 것입니다. 새로운 해양 시추에 대한 최근의 대통령 금지는 WTI의 운영에 영향을 미치지 않을 것입니다. 2024년 12월 1일부터 시행되는 Garden Banks 판매는 2024년 연말 유전에 약 12만 배럴의 석유에 해당하는 영향을 미칠 것입니다.
W&T Offshore (NYSE: WTI) a annoncé plusieurs mises à jour opérationnelles clés. L'entreprise a signé un PSA pour vendre son intérêt non essentiel dans les blocs Garden Banks 385/386, produisant 195 Boe/j, pour 12,3 millions de dollars. Deux grands développements de champ devraient reprendre la production : le champ West Delta 73 d'ici mi-deuxième trimestre 2025, et les champs Main Pass 108/98 début deuxième trimestre 2025, ce dernier ayant précédemment produit 6,1 MMcfe/j avant d'être arrêté.
L'entreprise recevra un règlement d'assurance de 58,5 millions de dollars en janvier 2025 pour une perte accidentelle au puits Mobile Bay 78-1. Le récent décret présidentiel interdisant les nouvelles forages offshore n'affectera pas les opérations de WTI. La vente des Garden Banks, effective le 1er décembre 2024, affectera les réserves de fin d'année 2024 d'environ 0,12 million de barils d'équivalent pétrole.
W&T Offshore (NYSE: WTI) hat mehrere wichtige betriebliche Updates angekündigt. Das Unternehmen hat einen PSA unterzeichnet, um sein nicht-essentielles Interesse an den Garden Banks Blocks 385/386, die 195 Boe/d produzieren, für 12,3 Millionen Dollar zu verkaufen. Zwei große Feldentwicklungen sollen die Produktion wieder aufnehmen: das West Delta 73 Feld bis Mitte des zweiten Quartals 2025 und die Main Pass 108/98 Felder zu Beginn des zweiten Quartals 2025, wobei letzteres zuvor 6,1 MMcfe/d produzierte, bevor es stillgelegt wurde.
Das Unternehmen wird im Januar 2025 eine Versicherungsentschädigung von 58,5 Millionen Dollar für einen Schadensfall am Mobil Bay 78-1 Bohrloch erhalten. Das kürzlich angekündigte Präsidialverbot für neue Offshore-Bohrungen wird die Operationen von WTI nicht beeinträchtigen. Der Verkauf von Garden Banks, der am 1. Dezember 2024 in Kraft tritt, wird die Reserven zum Jahresende 2024 um etwa 0,12 Millionen Barrel Öläquivalent beeinflussen.
- Sale of Garden Banks assets for $12.3 million at over $60,000 per flowing barrel
- Expected restart of West Delta 73 and Main Pass 108/98 fields in Q2 2025, adding significant production
- Receiving $58.5 million insurance settlement in January 2025
- No impact from Presidential offshore drilling ban on current operations
- Loss of 195 Boe/d production from Garden Banks asset sale
- Reduction of 0.12 million barrels of oil equivalent in reserves
- Multiple fields currently non-operational pending restart
Insights
The multiple operational updates from W&T Offshore reveal strategic moves to strengthen its financial position. The sale of Garden Banks assets at <money>$12.3 million</money> (<money>$60,000</money> per flowing barrel) represents excellent value monetization, significantly above typical Gulf of Mexico transaction multiples. The upcoming <money>$58.5 million</money> insurance settlement provides substantial cash injection, improving liquidity without adding debt.
The anticipated production restoration at West Delta 73 and Main Pass fields (combined ~6.1 MMcfe/d) should boost cash flows by Q2 2025. Simple math suggests potential annual revenue addition of <money>$15-20 million</money> at current commodity prices. The company's immunity to the new offshore drilling ban maintains operational flexibility and future growth potential.
The resolution of midstream infrastructure challenges at multiple fields demonstrates W&T's operational acumen. The strategic acquisition of midstream assets for Main Pass 108 and 98 fields eliminates third-party dependencies and provides better operational control. Mobile Bay's production profile (<percent>81%</percent> gas) positions W&T favorably in the natural gas market, particularly with the MB 78-1 settlement addressing production losses.
The divestiture of Garden Banks assets, producing just 195 Boe/d, shows smart portfolio optimization - selling non-core assets while focusing on higher-impact properties. The minimal reserve impact of 0.12 million BOE suggests the transaction maximizes near-term value without significantly compromising long-term potential.
HOUSTON, Jan. 08, 2025 (GLOBE NEWSWIRE) -- W&T Offshore, Inc. (NYSE: WTI) (“W&T” or the “Company”) today provided operational and financial updates on recent developments.
- Recently signed a purchase and sale agreement (“PSA”) to sell a non-core interest in Garden Banks Blocks 385 and 386 which included latest net production of approximately 195 barrels of oil equivalent per day (“Boe/d”) (
72% oil) for$12.3 million ; - Announces that the West Delta 73 field, which W&T acquired in January 2024, is expected to come back online by mid-second quarter 2025;
- Announces that the Main Pass 108 and 98 fields, which have been shut in since June 2024, are expected to return to production by early second quarter of 2025.
- Net production at these fields averaged a combined 6.1 million cubic feet of natural gas equivalent per day (“MMcfe/d”) (
78% gas) in June 2024 prior to being shut-in due to third-party operator related bankruptcy matters;
- Net production at these fields averaged a combined 6.1 million cubic feet of natural gas equivalent per day (“MMcfe/d”) (
- Scheduled to receive a
$58.5 million cash insurance settlement payment in January 2025 related to a casualty loss event at its Mobile Bay 78-1 well in 2023; and - Does not expect any impact on ongoing operations from the Presidential ban announced on January 6, 2025 on new offshore oil and gas drilling.
Tracy W. Krohn, W&T’s Chairman and Chief Executive Officer, commented, “We believe that these recent developments will have a positive impact to our balance sheet and provide upside as we enter 2025. The sale of our non-core interests in Garden Banks 385 and 386 at over
Additional Information
W&T recently signed a PSA to sell a non-core interest in Garden Banks Blocks 385 and 386 which included net production of approximately 195 Boe/d for
W&T entered into a resolution with the third-party pipeline operator at its West Delta 73 field. Although a few details remain subject to finalization by the Court, W&T expects to restart production from the field by the middle of the second quarter of 2025. The West Delta 73 Field was originally acquired by W&T from Cox Operating, LLC and certain of its affiliates in January 2024.
In June 2024, W&T received notice from the U.S. Department of Interior, Bureau of Safety and Environmental Enforcement, that it would be required to cease production at its Main Pass 108 and 98 fields as the result of a shut-in of midstream infrastructure not owned by W&T. W&T signed a purchase agreement and other arrangements to acquire the necessary midstream infrastructure, which is expected to allow the Company to return the Main Pass 108 and 98 fields to production by early second quarter of 2025. The return to production is subject to W&T obtaining necessary governmental approvals and permits in connection with the acquisitions, in addition to customary closing conditions.
In February 2023, during the Mobile Bay plant turnaround, the MB 78-1 well was shut-in and did not return to production following completion of the planned maintenance. W&T filed a claim under its Energy Package Policy and in December 2024, the Company and the Underwriters of the Energy Package Policy agreed to a settlement of claims in the amount of
On January 6, 2025 there was a Presidential ban announced on new oil and gas drilling in certain U.S. offshore areas. The ban covers the Atlantic coast and eastern Gulf of Mexico, as well as the Pacific coast off California, Oregon and Washington, as well as a section of the Bering Sea off Alaska. W&T does not have any production nor leases that are impacted by this action.
About W&T Offshore
W&T Offshore, Inc. is an independent oil and natural gas producer, active in the exploration, development and acquisition of oil and natural gas properties in the Gulf of Mexico. As of September 30, 2024, the Company had working interests in 53 producing offshore fields in federal and state waters (which include 46 fields in federal waters and seven in state waters). The Company has under lease approximately 673,100 gross acres (515,400 net acres) spanning across the outer continental shelf off the coasts of Louisiana, Texas, Mississippi and Alabama, with approximately 514,000 gross acres on the conventional shelf, approximately 153,500 gross acres in the deepwater and 5,600 gross acres in Alabama state waters. A majority of the Company’s daily production is derived from wells it operates. For more information on W&T, please visit the Company’s website at www.wtoffshore.com.
Forward-Looking and Cautionary Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this release regarding the Company’s financial position, operating and financial performance, business strategy, plans and objectives of management for future operations, closing of acquisitions, expected returns to production, and future results, are forward-looking statements. When used in this release, forward-looking statements are generally accompanied by terms or phrases such as “estimate,” “project,” “predict,” “believe,” “expect,” “continue,” “anticipate,” “target,” “could,” “plan,” “intend,” “seek,” “goal,” “will,” “should,” “may” or other words and similar expressions that convey the uncertainty of future events or outcomes, although not all forward-looking statements contain such identifying words. Items contemplating or making assumptions about actual or potential future production and sales, prices, market size, and trends or operating results also constitute such forward-looking statements.
These forward-looking statements are based on the Company’s current expectations and assumptions about future events and speak only as of the date of this release. While management considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond the Company’s control. Accordingly, you are cautioned not to place undue reliance on these forward-looking statements, as results actually achieved may differ materially from expected results described in these statements. The Company does not undertake, and specifically disclaims, any obligation to update any forward-looking statements to reflect events or circumstances occurring after the date of such statements, unless required by law.
Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially including, among other things, the regulatory environment, including availability or timing of, and conditions imposed on, obtaining and/or maintaining permits and approvals, including those necessary for drilling and/or development projects; the impact of current, pending and/or future laws and regulations, and of legislative and regulatory changes and other government activities, including those related to permitting, drilling, completion, well stimulation, operation, maintenance or abandonment of wells or facilities, managing energy, water, land, greenhouse gases or other emissions, protection of health, safety and the environment, or transportation, marketing and sale of the Company’s products; inflation levels; global economic trends, geopolitical risks and general economic and industry conditions, such as the global supply chain disruptions and the government interventions into the financial markets and economy in response to inflation levels and world health events; volatility of oil, NGL and natural gas prices; the global energy future, including the factors and trends that are expected to shape it, such as concerns about climate change and other air quality issues, the transition to a low-emission economy and the expected role of different energy sources; supply of and demand for oil, natural gas and NGLs, including due to the actions of foreign producers, importantly including OPEC and other major oil producing companies (“OPEC+”) and change in OPEC+’s production levels; disruptions to, capacity constraints in, or other limitations on the pipeline systems that deliver the Company’s oil and natural gas and other processing and transportation considerations; inability to generate sufficient cash flow from operations or to obtain adequate financing to fund capital expenditures, meet the Company’s working capital requirements or fund planned investments; price fluctuations and availability of natural gas and electricity; the Company’s ability to use derivative instruments to manage commodity price risk; the Company’s ability to meet the Company’s planned drilling schedule, including due to the Company’s ability to obtain permits on a timely basis or at all, and to successfully drill wells that produce oil and natural gas in commercially viable quantities; uncertainties associated with estimating proved reserves and related future cash flows; the Company’s ability to replace the Company’s reserves through exploration and development activities; drilling and production results, lower–than–expected production, reserves or resources from development projects or higher–than–expected decline rates; the Company’s ability to obtain timely and available drilling and completion equipment and crew availability and access to necessary resources for drilling, completing and operating wells; changes in tax laws; effects of competition; uncertainties and liabilities associated with acquired and divested assets; the Company’s ability to make acquisitions and successfully integrate any acquired businesses; asset impairments from commodity price declines; large or multiple customer defaults on contractual obligations, including defaults resulting from actual or potential insolvencies; geographical concentration of the Company’s operations; the creditworthiness and performance of the Company’s counterparties with respect to its hedges; impact of derivatives legislation affecting the Company’s ability to hedge; failure of risk management and ineffectiveness of internal controls; catastrophic events, including tropical storms, hurricanes, earthquakes, pandemics and other world health events; environmental risks and liabilities under U.S. federal, state, tribal and local laws and regulations (including remedial actions); potential liability resulting from pending or future litigation; the Company’s ability to recruit and/or retain key members of the Company’s senior management and key technical employees; information technology failures or cyberattacks; and governmental actions and political conditions, as well as the actions by other third parties that are beyond the Company’s control, and other factors discussed in W&T Offshore’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q found at www.sec.gov or at the Company’s website at www.wtoffshore.com under the Investor Relations section.
| CONTACT: | Al Petrie | Sameer Parasnis |
| Investor Relations Coordinator | Executive VP and CFO | |
| investorrelations@wtoffshore.com | sparasnis@wtoffshore.com | |
| 713-297-8024 | 713-513-8654 |
FAQ
What is the value of WTI's Garden Banks asset sale and when will it close?
When will WTI's West Delta 73 and Main Pass 108/98 fields resume production?
How much is WTI's insurance settlement for the Mobile Bay 78-1 well incident?
How will the 2025 Presidential offshore drilling ban affect WTI operations?
What is the production impact of WTI's Garden Banks asset sale?
