Mariner Energy, Inc. (NYSE: ME) shares dropped more than 4% Thursday following news that one of its production platforms exploded in the Gulf of Mexico. Mariner shares lost 96 cents, more than 4%, at $22.39 in afternoon trading.
Houston-based Apache Corp. (NYSE: APA)is in the process of closing on a $2.7 billion acquisition of Mariner. Completion of the transaction is expected in the third quarter of 2010. Apache shares fell $1.89, or 2%, to $90.57 with the news of the Mariner accident.
Mariner Energy has diversified operations in the Permian Basin, the Gulf Coast, and the Gulf of Mexico, both in the deepwater and on the shelf. As of Dec. 31, 2009, Mariner had approximately 1,087 billion cubic feet equivalent of natural gas (bcfe) of proved reserves, of which approximately 53% were natural gas and 47% were oil, condensate, and natural gas liquids. Total net production in 2009 was approximately 126.5 bcfe, and net production averaged 347 million cubic feet equivalent of natural gas (MMcfe) per day.
The company owns more than 240 blocks in shallow parts of the Gulf of Mexico.
The platform that exploded is called Vermilion 380. According to regulatory filings, Mariner owns 100% of the platform.
Mariner said in a statement that the platform had been producing both oil and natural gas. During the last week of August, the Vermilion produced an average of 9.2 million cubic feet of natural gas per day and 1,400 barrels of oil.
It's unclear if the platform was producing when the explosion occurred.
Mariner’s platform is in 340 feet of water, which would make any spill response much easier than the response to BP’s blown-out well.