Offshore oil and production company Energy XXI USA Inc., headquartered in Houston, recently sold its Grand Isle Gathering System (GIGS) for $245 million, bumping its total liquidation up to $1 Billion.
The company announced the sale of its GIGS to energy infrastructure real estate investment trust CorEnergy Infrastructure Trust, Inc. today and expects to close the deal by the end of June.
CoEnergy, which focuses mainly on midstream and downstream assets, will assume ownership and the assumption of abandonment liabilities, but Energy XXI will still have access to the pipeline’s operations via a lease agreement with CoEnergy.
Energy XXI will collect revenue the pipeline generates via third-party transportation, as per the lease agreements with CoEnergy.
“The monetization of the GIGS pipeline assets is another important step in executing the strategy we communicated to our investors,” Energy XXI Chairman, President and CEO John Schiller said. “Continuing to maintain operatorship of the GIGS is important to us, ensuring transportation of a significant portion of our production.”