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Mosman Oil & Gas said Australia's Xstate Resources had terminated an agreement to invest in the Champion project in Texas.
The decision came after the project's operator, Baja Oil & Gas, said drilling on the prospect could be delayed while it considered a cost-saving opportunity.
Mosman said it expected to provide an update on the timing and funding of the related Falcon well in due course.
Mosman currently owned 60% of the prospect, though Baja Oil & Gas had identified a potential cost saving by acquiring and re-purposing an existing well to drill and test the Falcon target.
'Once this opportunity has been evaluated, Mosman expects the operator to provide updated drilling cost estimates and a revised schedule which may result in a delay from the current third-quarter 2019 drilling expectation,' it said.
At 1:30pm: (LON:MSMN) Mosman Oil And Gas Ltd share price was -0.02p at 0.25p