Talos Energy, the oil and gas company focused on offshore exploration and production, participated in five drilling projects in the second quarter with a capital program front-loaded in the first half of 2019.
Talos Energy also said that it was successful in the Bulleit and Orlov projects in the deepwater U.S. Gulf of Mexico, new production established in the Ewing Bank drilling program in the shallow water U.S. Gulf of Mexico, the successful conclusion of the Zama appraisal and the ongoing program in the Block 2 and 31 contractual areas in offshore Mexico.
"We executed numerous successful drilling projects in both deepwater and shallow water in the U.S. Gulf of Mexico and two drilling programs in offshore Mexico. Our annual capital program was significantly front-loaded in the first half of the year with five rigs working during the second quarter. Even with this high level of activity, our U.S. Gulf of Mexico business generated meaningful free cash flow in the second quarter," said President and Chief Executive Officer Timothy S. Duncan.
"We believe that reinvesting cash flows from the U.S. Gulf of Mexico business into our globally recognized Zama discovery will help accelerate the value realization of that asset, and we are extremely proud of our progress on that front. In the second half of the year, we expect to continue generating a significant amount of free cash flow from our U.S. Gulf of Mexico business that will be further enhanced by having concluded the Zama appraisal in the second quarter," he added.
Production from the U.S. Gulf of Mexico was significantly impacted in the month of July due to precautionary shut-ins of facilities and evacuations associated with Hurricane Barry.
According to the Bureau of Safety and Environmental Enforcement's (BSEE) daily reports, impacts from the storm peaked on July 14 resulting in approximately 1.4 million barrels per day of oil production shut-in, or 73% of all U.S. Gulf of Mexico oil production.
Although there was no major storm related damage, the production impact to Talos spanned approximately one week and also peaked on July 14 with Talos shutting in approximately 85% of its production in the period. Talos expects the production deferral from Hurricane Barry to impact only the third quarter of 2019 financial results.
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