High Island
Location: Texas, Federal Waters
Area: 53.2 km2 (13,140 acres)
Sterling Equity: 7.5% over-riding royalty, 50% to 100% WI; 42.3% to 83.33% NRI
High Island Blocks 52, 53
Sterling operates High Island 52 Field which is one of the oldest gas fields in offshore Texas. In late 2006, Sterling agreed to farm-out a portion of the field, while retaining an over-riding royalty interest. This will allow the drilling of one or two higher risk opportunities at no cost or risk to Sterling. A prior farm-out agreement lead to the 96 BCFE deep discovery in the NE/4 of the block in which Sterling retains a 7.5% over-riding royalty interest. This represents the bulk of Sterling’s production in High Island.
High Island Block A-94
Sterling Energy has a 100% working interest and is the operator. The block was awarded in 2003 to Sterling Energy as high bidder at OCS sale 187. This exploration lease has a five-year primary term. Sterling acquired HI A94 to explore for deep gas potential. This block sits in an area of the Gulf that currently has no 3-D seismic data coverage.
