In heavy bottom pan over medium heat, bring olive oil to gentle simmer.
Toss in shallots & garlic, then cover & sauté 2-3 minutes or until fragrant.
Turn down heat to low-medium, add water & mushroom, stirring intermittently, cover & cook for 10-15 additional minutes, or until all liquid absorbed.
Remove cover, turn heat back up to medium-high & add sherry, stirring until all liquid absorbed.
Remove from heat, fold in butter, season to taste & set aside.