Energean Sells More Gas from Karish Field

Credit: Energean
Credit: Energean

Energean, an oil and gas company focused on developing its Karish gas field offshore Israel, has signed agreements to sell more gas from the project.

The company said Thursday its 70 percent-owned subsidiary Energean Israel had entered into a new set of agreements and amendments to existing agreements with Rapac Energy Limited and its related companies to supply an additional amount averaging 0.4 Bcm/yr of gas for terms of between 6 and 15 years starting from first gas from the Karish gas development project. The agreements include take-or-pay, exclusivity, and floor pricing provisions.

Energean Israel Limited now has gas sales agreements in place to supply approximately 7.4 Bcm/yr of gas on plateau.

"All contracts contain provisions for take-or-pay and / or exclusivity, and floor pricing, ensuring that Energean’s revenue stream in Israel is secured, predictable and largely insulated from global commodity price fluctuations, supporting Energean’s target to begin paying a dividend following first gas from the 8 Bcm/yr Karish project, which is currently expected in Q4 2021," Energean said.

Energean Power FPSO, under construction at Sembcorp's yard in Singapore (Photo from November. Credit: Energean)

As previously reported, Energean is looking to take full ownership of its 70 percent-owned subsidiary Energean Israel.

The company said last week it had entered into an exclusivity arrangement with an affiliate of Kerogen Capital regarding a potential acquisition of Kerogen's 30% shareholding in Energean Israel.

"On 7 December 2020, Energean and Kerogen entered into an agreement granting a 30-day period of exclusivity for the purposes of negotiating the potential transaction," Energean said, adding that there can be no certainty that a transaction will proceed.

Energean Israel holds a 100% working interest in the Karish and Tanin leases, offshore Israel. A recent independent Competent Persons Report by DeGolyer and MacNaughton ("D&M") certified gross 2P reserves of 98.2 Bcm (3.5 Tcf) of gas and 99.6 million barrels ("MMbbls") of liquids across the Karish, Karish North, and Tanin fields representing approximately 729 million barrels of oil equivalent. 

Apart from the Karish and Tanin leases, Energean Israel owns a 100% working interest in four exploration blocks (Blocks 12, 21, 23, 31) offshore Israel that offer low-risk, near-infrastructure drilling opportunities to be targeted by its next drilling program, which is, according to Energean expected to begin in early 2022. 

These prospects are located near the location where the Energean Power FPSO will be moored, representing potential low-cost tie-back options for future developments.

The D&M CPR estimated gross best estimate risked prospective resources across the Karish and Tanin leases and Block 12 of 62.0 Bcm of gas plus 33.4 MMbbls of liquids.

Also, Energean Israel has an 80% working interest in a further four blocks in Zone D, offshore Israel.

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