Greek oil and gas exploration company Energean, which has acquired the Karish and Tanin offshore gas fields, says that within six months it will present Israel's Ministry of National Infrastructures, Energy and Water Resources with its plan to develop the fields. On Tuesday, the Israeli government's Petroleum Council recommended acceptance of the deal in which Energean will buy the fields from Delek Group Ltd. (TASE: DLEKG) and Noble Energy Inc. (NYSE: NBL) for $148 million.
Karis and Tanin together contain an estimated 68 billion cubic meters of natural gas. Energian says that it estimates gas production could begin by 2020 and that the cost of developing the fields will be about $1 billion.
Energean chairman, CEO and founder Mathios Rigas said, "We are delighted to have received the approval of the Israeli Government on this transaction and for their swift consideration of the matter. The acquisition of Karish and Tanin and their development is a significant step for Energean, but it is also a big milestone for Israel in developing its gas strategy, by bringing competition in the local market. Energean is committed to delivering a mutually beneficial and successful development and gas sales program as partners with the Israeli government."
He added, "Karish and Tanin will supply the Israeli domestic market for many years and we are eager to press ahead with its development as soon as possible. We will be submitting a comprehensive Field Development Plan within six months of closing the transaction, and will be selecting our proposed contracting partners in the near future. We will also be starting negotiations with potential gas users and are confident that we can deliver competitive gas prices and services for the Israeli consumers."
The Karish and Tanin plan is the third plan that Energean is committed to over the next few years with development programs being prepared for the Epsilon (North Aegean Sea) and West Katakolon (Western Greece/Ionian Sea) with combined 2P reserves of 25 MMbbl. Energean has additional exploration acreage in Western Greece, Montenegro and Egypt. The company anticipates an investment of around $1.3 billion in exploration and development (including Karish and Tanin) over the next 5 years.
Published by Globes [online], Israel business news - www.globes-online.com - on December 8, 2016
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