Stone Energy Corp. (NYSE: SGY) said Jan. 10 it struck an oil discovery in its Gulf of Mexico (GoM) deepwater Mt. Providence development well at Mississippi Canyon Block 28.
The Mt. Providence well (the MC 28 #4 well) encountered about 153 net ft of high quality, primarily oil pay in one Miocene interval with no visible water level, which exceeded pre-drill expectations, according to the company press release. Stone generated the prospect and owns a 100% working interest in the well.
Completion operations on the Mt. Providence well will commence in second-quarter 2018 with first production expected early in the third quarter.
The well is expected to have an IP rate of about 3,000 to 5,000 barrels of oil equivalent per day and will be tied back to the 100% Stone-owned Pompano platform through existing subsea infrastructure.
James M. Trimble, Stone's interim CEO, said the company is excited about the Mt. Providence drilling results.
"This successful well will quickly generate additional production and cash flow with minimal incremental operating cost since we can capitalize on existing subsea infrastructure and available capacity at our Pompano platform," Trimble said in a statement.
Additionally, Stone said the Derbio well (the MC 72 #3 well) is now expected to spud in late January with results expected early second-quarter 2018.
Derbio is a Stone-generated prospect and follows the Rampart Deep success announced in September 2017. If successful, the Rampart Deep/Derbio project could be a multi-well tie back to the Pompano platform, with first production expected by late 2019.
Working interest partners in the Derbio prospect are Stone with 40%, Deep Gulf Energy III LLC with 30% (operator) and entities managed by Ridgewood Energy Corp. (including Riverstone Holdings LLC and its portfolio company ILX Holdings III LLC) with 30%.
In November, Stone agreed to merge with Talos Energy LLC in an all-stock transaction that the companies say represents an equity value of $1.9 billion. The transaction is expected to close in the first or second quarter of 2018, the companies said.