Energy acquisition news : US oil companies Talos Energy and Stone Energy have reached a deal to combine into an offshore-focused exploration and production company with an enterprise value of $2.5 billion.

Texas-based Talos Energy will acquire Stone Energy which is based in Louisiana in what will be an all-stock transaction, as per the latest oil industry news.

Both the oil and gas companies are focused on operating in the Gulf of Mexico with their combination based on figures in 2017 estimated to have around 47Mboe of average daily production and 136MMboe of proved reserves, of which oil makes up 69%.

Almost 75% of their combined reserves are contained in the Deepwater Gulf of Mexico.

The combined entity will be named as Talos Energy with the shareholders of Talos to hold 63% ownership in it while the remainder 37% ownership will be given to shareholders of Stone Energy.

Talos Energy will be headquartered in Houston besides having additional offices in New Orleans and Lafayette.

Commenting on the Talos Energy Stone Energy merger, James M. Trimble, who is the interim CEO and President of Stone Energy, said: “The team’s management of Stone’s assets and business in a safe and environmentally responsible manner will continue our success for the combined shareholder base.

“The combined company will be strategically positioned to drive meaningful production growth through complementary acreage positions.”

Talos Energy will own about 1.2 million gross acres post-merger in the Gulf of Mexico, with nearly 160,000 acres of it contained in Mexican waters.

The consolidated assets of Talos Energy will feature the Zama oil discovery, which is believed to have 1.4-2.0 billion gross barrels of oil. Talos Energy which is the operator of the Zama field has 35% and is partnered by Sierra which holds 40% stake and Premier which holds 25% stake in the offshore Mexican oil field.

Timothy S. Duncan, the CEO of Talos, commenting on the Talos Energy Stone Energy merger, said: “We will have two core areas in the Deepwater U.S. Gulf of Mexico Deepwater and the outstanding new Zama discovery located in the shallow waters of offshore Mexico.

“The combined talent, technical resources and balance sheet of the resulting company will allow us to accelerate development of our own robust project inventory while also giving us the horsepower to pursue compelling transactional and exploration opportunities.”

The Talos Energy Stone Energy merger is slated to be finalized in either the first or second quarter of next year, should it obtain regulatory approvals and satisfy customary conditions.

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  Energy acquisition news, Gulf of Mexico, Houston, Oil and gas news, Stone Energy, Talos Energy, Texas, USA, Zama oil discovery