While working toward first injections at a carbon dioxide storage site to serve Freeport LNG, Houston-based Talos Energy Inc. said it has begun flowing production from two deepwater wells in the U.S. Gulf of Mexico (GOM).
One year after discovering hydrocarbons, the Lime Rock and Venice wells were “brought safely online in late December 2023,” management said. The independent had planned to bring the two wells online early this year. Talos holds a 60% working interest in both discoveries, which are near the company’s Ram Powell platform, where production is flowing via subsea tiebacks.
“With these production additions, the Ram Powell facility is expected to achieve the highest combined sustainable production rate since approximately 15 years ago,” CEO Timothy S. Duncan said.
Lime Rock and Venice hit commercial quantities of oil and gas during sequential drilling operations in the final three months of 2022, Talos noted. The wells have achieved an initial combined gross production rate of 18,500 boe/d. Combined gross ultimate recoverable resources of the two discoveries are estimated at 20-30 million boe.
In addition to the net production, the company said it would collect volume-based production handling fees from partners in both discoveries.
“The safe start-up of Lime Rock and Venice in less than 12 months is an extraordinary achievement by our operations team, which included new subsea installation and facility upgrade work,” Duncan said.
Talos acquired the Lime Rock prospect, which is about seven miles from the Ram Power facility, in November 2020. The Venice prospect was identified within the existing Ram Powell unit acreage about three miles from the facility.
The independent initially held a 100% working interest in both prospects before successful farm-downs to achieve its targeted 60% working interest.
Talos said it added more U.S. offshore acreage in December during the GOM Lease Sale 261. The exploration and production company was named the apparent high bidder on 13 deepwater blocks comprising roughly 48,000 net acres, management said.
Talos also has executed lease exchange agreements with BP Exploration & Production Inc., Chevron U.S.A. Inc., and Hess Corp. to consolidate acreage across 15 blocks in the deepwater Green Canyon region. Talos said it expects to hold stakes in the blocks averaging 15-20%.
“The proximity of these prospects to our existing assets, including Ram Powell, Pompano, Prince and Brutus facilities, bolsters our infrastructure-led, near-field strategy in the GOM while providing opportunities to lower the overall carbon intensity of our assets over time,” Duncan said last month.
Talos last year added six major facilities to its existing GOM portfolio after completing a $1.1 billion acquisition of EnVen Energy Corp. The assets – in Atwater Valley, Ewing Bank, Green Canyon, Mississippi Canyon and Viosca Knoll blocks – added an estimated 24,000 boe/d in production and doubled Talos’ deepwater infrastructure footprint.
The merger also positioned the independent to advance the growing carbon capture and sequestration (CCS) business.
Talos is working to advance four CCS projects along the Gulf Coast, including a 25 million metric ton storage site at the Freeport liquefied natural gas facility with Storegga Ltd. According to Talos, first injections are expected later this year.
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