Talos Working on Engineering Design for Zama Oil, Gas Project in Mexico
(Reuters) — Talos Energy is making a final review of the engineering design and working to secure financing for the Zama project, a Mexican oil and gas project in the Gulf of Mexico, before making a final investment decision (FID), the company's chief executive officer said on Tuesday.
The U.S. firm in late September completed a $125 million transaction with Mexican Grupo Carso that involved the sale of 49.9% of its subsidiary Talos Mexico, CEO Tim Duncan said during the company's presentation of its third quarter results.
Duncan did not elaborate on a specific date for sanctioning Zama but said 2024 will be "an important year for that asset" after time was lost due to a standoff over who would operate the flagship project, which forced changes in its design.
Zama's operator and largest shareholder is Mexico's state company Pemex with 50.4%. Talos and Grupo Carso now hold 17.4% of Zama, Wintershall Dea has 19.8% and Harbour Energy the remaining 12.4%.
The company was "happy that we're back on track, happy to have Carso. Some of the debates and some of the frustration is behind us," Duncan said.
"It has certainly been long enough. It's time to get the ball moving on that. It's important to our shareholders... I think we're in a better place with that asset that we've been over the last couple of years," he added.
Talos had said in a presentation in September that two platforms plan to be deployed at water depths of 500-585 feet in the Zama field, able to produce up to 190,000 barrels per day (bpd) of medium crude and associated gas.
The production will be transported through pipelines to Mexico's Dos Bocas terminal. Talos has estimated a break-even price of $25 per barrel and 3-year cumulative net cash flow of some $650 million.
Zama's gross recoverable resources are estimated at 735 million barrels.
Talos on Tuesday reported a $383.1 million revenue in the third quarter. That result led to a net loss of $2.1 million, or $0.02 per diluted share in the period.
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