Stone sanctions Amethyst project

US independent Stone Energy has officially sanctioned the development of its Amethyst discovery in the deep-water Gulf of Mexico, which will be produced via a single tie-back to the Pompano platform.

The 100%-owned well in Mississippi Canyon Block 26, which came across 90 feet of net gas and condensate pay in February, will be connected with the operated platform less than five miles away.

First production is planned for 2016, Stone said in a quarterly earnings report.

"A development plan for Amethyst was sanctioned early in the second quarter of 2014 and long lead items have been ordered for a single well tie-back," the company said.

Stone chief executive David Welch said last year that BP had made a down-dip discovery with its Supertramp probe in the 90s, and that Amethyst was an up-dip target.

Stone is also installing a looped gathering system with completion targeted for the end of 2014 to capture production from the Cardona and Cardona South wells in Mississippi Canyon Block 29, which will also be tied back to the Pompano platform.

Overall, the company saw a steep drop in profits during the three months to June amid lower prices for natural gas and natural gas liquids as well as higher rates of depreciation and amortisation.

Stone reported net income of $4.4 million on oil and gas revenue of $205 million for the three months to June. That compared to profits of $39 million in the year-ago quarter on revenue of $243.5 million.

During the 2014 period the company also spud a well to test the Utica shale at the Mary field in West Virginia and unloaded shallow-water Gulf of Mexico assets in a deal of about $200 million with Talos Energy.

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