Cobalt International Energy Inc. (NYSE: CIE) said July 12 it will expand a deepwater Gulf of Mexico asset currently on the Houston-based company's chopping block.
Cobalt said it entered agreements with its co-owners in the Anchor development to unitize and include the company's two leases immediately south of the current Anchor unit (Green Canyon blocks 850 and 851) into the existing Anchor unit.
“Expansion of the Anchor unit to include Cobalt’s two blocks to the south is key to optimizing the development plan and increasing oil recovery from Anchor as the reservoir clearly extends onto these blocks,” Timothy J. Cutt, Cobalt's CEO, said in a statement. “This agreement makes Anchor even more attractive of a development going forward, whether for us or for a potential purchaser in our ongoing sales efforts.”
In March, Cutt said Cobalt was pursuing three strategies: sell assets to fund its core projects; merge with another company with cash flow to fund developments; or sell the entire company.
The Anchor Unit is located in the GoM's Green Canyon Area and operated by Chevron Corp. (NYSE: CVX).
The transfer of interests in the two leases and the revised Anchor unit are subject to customary regulatory approval. Following such approval, Cobalt will retain a 20% working interest in the revised Anchor Unit.
Cobalt also recently regained compliance with the New York Stock Exchange following completion of a 1-for-15 reverse stock split.
Formed in 2005, Cobalt is an independent E&P active in the deepwater U.S. Gulf of Mexico and offshore West Africa.