AUSTRALIA-based Entek Energy has sold its interests in the Gulf of Mexico to project partner Peregrine Oil & Gas for US$1.86 million.

Comprising a 38 per cent stake in block GA A133 and 25% of PN 975, the sale also included Entek’s overriding royalty interest in the VR 341 and VR 342 blocks – which the company valued at about US$3 million.

Entek said gas developments at GA A133 and PN 975 had both been shut-in following their natural depletion and were scheduled to be plugged and abandoned during 2016 and 2017.

Project operator Peregrine had assumed all of Entek’s plugging and abandonment obligations as part of the sale – duties Entek said would have cost it over US$1 million.

Entek chairman Graham Riley said Entek had been “significantly restricted” in participating in US offshore producing assets due to challenging oil and gas price and capital market conditions, as well as onerous bonding requirements for future plugging and abandonment obligations.

“This transaction eliminates the significant and open ended funding obligations for the abandonment of Entek’s two depleted Gulf of Mexico gas interests and stabilises the company’s working capital position to around US$3 million upon receipt of funds expected shortly,” he said.