Houston-based Talos Energy on May 10th completed a merger with Stone Energy Corporation, a move that will offer “increased scale and liquidity” for shareholders, a company spokesperson said.
The newly merged operation will appear as TALO on the New York Stock Exchange. The merger was the result of a monumental, almost single-handed effort by Talos CEO Timothy Duncan. He put the finishing touches on the deal while sitting at the kitchen table of his mother’s home in Houston.
Duncan was scrambling in the wake of Hurricane Harvey. It required him to flee his home and get his family to safe ground — all dramatic events happening while Duncan was knee deep in details of the merger.
Certainly, it’s been an eventful couple of years for the scrappy oil exploration company. In 2017 Talos, along with two partners, was the first consortium of privately-owned firms to drill for oil in Mexican territory in more than 80 years. Mexico nationalized its oil industry in 1938. The 2017 project led by Talos was made possible by a change in direction on exploration policy by Mexican officials — an attempt to revitalize that country’s flagging petroleum industry.
Better yet, the drilling project off the shores of the Mexican state of Tabasco brought turned out to be a significant strike. The new well, called the Zama-1, is estimated to contain 1.4 to 2 billion barrels of oil-equivalent. When fully developed, Zama-1 may produce 100,000 barrels per day.
Talos partnered with Sierra Oil and Gas and Premier Oil on the Zama project. Talos Energy will be the lead operator of the project and holds a 35% share.
With the newly completed merger behind it and the production of the Zama-1 ahead of it, the future looks bright for Tim Duncan and Talos. The company is on a firm foundation thanks to a new credit facility agreement which provides a borrowing base of $600 million, half of that available in cash.
Talos Energy is focused on the Gulf of Mexico where it plans future and ongoing exploration projects. Duncan said innovation, efficiency and high technology are keys to making his company competitive over the long term.