U.S. oil company Stone Energy has informed that drilling operations on the Rampart Deep Prospect in Mississippi Canyon Block 116, in the Gulf of Mexico, were initiated on June 3.
The Stone generated prospect will be drilled and operated by Deep Gulf Energy III and, if successful, it is expected to be tied back to Stone’s 100% owned Pompano platform, Stone said on Friday.
The prospect, which targets the Miocene interval, is located nine miles from the Pompano platform and is estimated to take two months to drill.
After a sell down of a portion of its position, Stone holds a 40% working interest in the well and received leasehold and other reimbursable costs. Additional working interest owners are Deep Gulf Energy III, LLC with 30% and entities managed by Ridgewood Energy Corporation (including Riverstone Holdings, LLC and its portfolio company ILX Holdings III, LLC) with 30%.
Job cuts
Recently, Stone implemented additional workforce reductions in order to “better align its employee base with current business needs.” The company expects this action to result in an approximate 25% decrease in salaries, general and administrative cash costs for the second half of 2017, translating into an expected quarterly cash SG&A outlay, before capitalization, of approximately $11 million to $12 million per quarter, excluding non-recurring and non-cash items. Stone projects an overall SG&A reduction of approximately 50% from 2016.
Interim Chief Executive Officer and President, James M. Trimble , stated, “The Rampart Deep well is an important step in Stone’s forward plans. A successful test of the Rampart Deep Prospect could lead to a multi-well development program, with a tie back to our Pompano platform further leveraging this facility.
“Partnering with Deep Gulf Energy and Ridgewood on this well reflects our renewed focus on efficient use of capital, and the reductions in SG&A reflect our continued commitment to manage our costs to better position Stone to be competitive in the current commodity price environment.”