Gulfx said the company would no longer participate through further payments in the South Marsh Island Block 138 and will forfeit the right to earn a 16.25% interest in the prospect.

In 2007 the company participated in the drilling of South Marsh Island Block 138, which resulted in the well being plugged and abandoned.

Gulfx expects to make further announcements regarding its remaining interest in four other Gulf of Mexico oil and gas prospects.

Meanwhile, Californian explorer Nuenco has expanded its stake in the US Gulf Coast, acquiring a 5% working interest in the Bullseye prospect in South Louisiana.

The 1700-acre prospect has a target reservoir potential of 12.5 million barrels of oil and 33 billion cubic feet of gas.

Nuenco is paying 6.67% of costs for the first well, Jumonville-1, spudded on April 28.

The well, operated by Golden Gate Petroleum, is expected to reach total depth of 14,200 feet in about four weeks.

Nuenco said the prospect is an excellent addition to its exploration portfolio and is highly prospective in a proven oil and gas field.

If Jumonville-1 is successful, several follow-up drill targets have been identified.

Participants in the Jumonville-1 well are Nuenco, Golden Gate Petroleum (43.33%), Modena Resources (15%), Pantheon Resources PLC (15%) and Eastern Advisors (20%).