Energy XXI Reaches Agreement With BOEM on Supplemental Bonding, $150 Supplemental Bonding Brings Total Bonding To $319M

Energy XXI

today announced that after several constructive meetings and exchanges of information, Energy XXI has reached an agreement with the Bureau of Ocean Energy Management (BOEM) with regard to supplemental bonding requirements for the company and its subsidiaries. Energy XXI has provided $150 million of supplemental bonding, bringing the company's total supplemental bonding to $319 million at an annual premium expense of $4.8 million, with approximately $10 million collateral posted. In addition, the company maintains $226 million in Letters of Credit to third parties on additional assets in the Gulf of Mexico. The BOEM has agreed to withdraw its orders with regard to supplemental bonding upon dismissal of the appeals filed by Energy XXI with the Interior Board of Land Appeals, and postponed until November 15, 2015 the issuance of any further requirements for financial assurance with respect to activities on existing properties of Energy XXI and its subsidiaries. In addition to the consideration provided under the agreement, during the interim period, Energy XXI and its subsidiaries continue to cooperate with and engage in constructive discussions with the BOEM and its sister agency, the Bureau of Safety and Environmental Enforcement, with regard to decommissioning and financial assurance matters.