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Anglo-American company BHP Billiton has announced that it had submitted the winning bid to acquire 60% participating interest, as well as operatorship of AE-0092 and AE-0093 blocks located in the Trion discovery, Gulf of Mexico.

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The remaining interest in the two blocks will be retained by PEMEX Exploration & Production Mexico (Pemex).

Pemex has estimated that gross recoverable resource from these blocks will be around 485 million barrels of oil equivalent.

The acquisition is subject to customary closing conditions, along with the necessary approval from the government. BHP Billiton expects that all relevant agreements will be finalised and signed within three months.

BHP Billiton made the bid by committing to pay upfront cash payment of $62.4m along with a Minimum Work Programme, which is estimated to be up to a maximum of $320m.

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"The remaining interest in the two blocks will be retained by PEMEX Exploration & Production Mexico (Pemex)."

If both companies agree to advance beyond the Minimum Work Programme, BHP Billiton will invest $570m in Minimum Work Contribution that includes the funding in Minimum Work Programme. It also includes a $624m cash contribution that comprises an upfront cash payment.

In the bid, BHP Billiton also made the commitment for an additional royalty of 4%.

BHP Billiton president of petroleum operations Steve Pastor: “We see attractive potential in Trion and the Perdido trend, and we are pleased to have the opportunity to further appraise and potentially develop this prospective frontier area of the deep-water Gulf of Mexico.

“This opportunity aligns with our strategy of owning and operating Tier-1 assets and provides an opportunity for BHP Billiton to leverage its industry-leading, deep-water drilling, development and operational expertise to create value in Mexico.”

Image: Shenzi Petroleum development, another BHP Billiton project in the deepwater Gulf of Mexico. Photo: Courtesy of BHP Billiton