Talos Energy Inc. recently went public as a result of their reverse merger with Stone Energy. Sounds smart right? Save the cost of an initial public offering while acquiring the operations of a near defunct competitor. But just because Talos has been working smart does not mean they have not been working hard.
The Talos-Stone merger, or acquisition (depending on who and when you ask), was a result of the painstaking efforts of one Timothy Duncan. Not only was Duncan facing the uphill battle of taking on a bankrupt company, but the $2.5 billion-dollar merger came occurred during August of 2017. If August 2017 does not hold any significance to you then must not have been in Texas at the time. It was during this month that Hurricane Harvey slammed southern Texas at peak intensity and became the second costliest storm in American history.
Tim Duncan was in his home-town of Kingwood, Texas when the hurricane hit. He was working diligently on the Talos Stone merger. In fact, he worked on that merger until he and his family had to be rescued by FEMA as the flooding of his community was unbearable. Talk about dedication.
While such dedication is impressive, it is nothing new for Tim Duncan. Son of an oil-man, Duncan was raised to be an industry maverick. While the oil industry zigs, Duncan zags with incredible ease and vision. Take for example, hydraulic fracking. Duncan admits that there are days when he wishes he had moved into the Permian Basin with the rest of the lot applying new tech to old oil fields. But Talos strategically went against the crowd to utilize their experience in less competitive arenas. “We resisted the temptation to join the land race onshore,” says Duncan, “I try explaining to young investors, and they have a hard time getting it.”
One of Duncan’s earlier achievements and now Talos largest asset is the Phoenix Field which sits 165 miles South of New Orleans. Formerly developed and operated by Chevron, Phoenix used to be known as Typhoon Field. That is until Hurricane Rita ripped the platform from the seafloor setting the rig out into open waters. At that point, Typhoon Field seemed like an ominous foreboding and the field was reborn as the Phoenix Field.
Talos recovered the wandering oil platform and now uses it to pump 16,000 barrels of oil a day from Phoenix Field. Once phoenix become operational again, Duncan was able to reevaluate seismic data which allowed for new oil discoveries 3,000 feet deeper than Chevron’s old reserves.
Just as was seen at Phoenix, Duncan has a certain awareness of his place among the larger integrated oil companies. “We’ve built business on the U.S. side, where we are following some of the best companies in the world, Chevron, Exxon, and Shell.” Duncan founded Talos in 2012 with $600 million in equity funding from Apollo and Riverstone.
Riverstone has continued to follow the success of Talos as per their new venture in Mexican waters. Last year, the Mexican Government deregulated their oil fields finally allowed non-governmental entities to explore and develop Mexican Oil Fields. Talos joined with U.K.-listed Premier Oil and Riverstone-backed Sierra Oil & Gas to buy the first auctioned acreage in Mexican water in over 80 years. This proved to be a promising venture as the Talos and the boys hit a 1,000-foot-thick layer of oil-soaked sandstone potentially containing 2 billion barrels of oil.
Resembling Wildcatter of yesteryear. Talos has developed oil fields in U.S. Waters but as also been one of the first independents to explore the Mexican side of the Gulf of Mexico.
Duncan bases much of his success on updated seismic measurements that allow for 3-D seismic surveys that give a better picture of subsurface terrain than previous wildcatters could only have dreamt of. Duncan has enjoyed such modern mapping techniques since entering the business in 1996. Duncan first started working in E&P when he began working for the Zilkha company. The 50-person Zilkha company sold for 1.3 billion in 1997, after they had snatched up shallow-water leases before the 3-D seismic revolution began. This experience with the benefits of such mapping have given Duncan an edge over other wildcatters throughout his career.
Talos Energy is constantly focusing on innovation in the fields of exploration and production. Recovering resources that were previously thought unreachable is basically their forte. Their successful strategy includes acquiring, exploiting and exploring in the Gulf of Mexico and Gulf Coast region. Stay in touch with Talos, to keep abreast of the extent of Tim Duncan’s future success. This success is backed by Duncan’s oil man instincts and his ability to interpret Talos sizable seismic database. Proprietary reprocessing techniques, and deep geological, geophysical and operating experience are sure to keep this wildcatter on top for many years to come.
Connect with Talos Energy on LinkedIn for the most up to date information.