The Board of Energean Oil & Gas PLC has approved the Final Investment Decision (FID) to proceed with the $1.6-billion Karish & Tanin Development Project, offshore Israel.
The Karish and Tanin fields are world-class assets with 2.4 TCF of natural gas (contingent resources) and 33 million barrels of light hydrocarbons liquids (contingent resources).
$405 million of the $460 million raised from the recent IPO of Energean will be used to fund the Company’s 70% share in the project, while the remaining 30% will be funded by Kerogen Capital, Energean’s partner in the project.
The project is also being financed through a Senior Credit Facility of US$1.275 billion recently announced and underwritten by Morgan Stanley, Natixis, Bank Hapoalim and Société Générale.
Energean has secured long-term gas agreements with some of the largest private power producers and industrial companies in Israel. The company has contracted for the purchase of a total of 61 BCM of gas over a period of 16 years, at an annual rate of approximately 4.2 BCM per year (on an ACQ basis).revp
Energean will develop the project through a new build, owned FPSO with gas treatment capacity of 800 MMscf/day (8 BCM/per annum) and liquids storage capacity of 800,000 bbls, which the company believes provides a flexible infrastructure solution and, potentially the scope to expand output for potential additional projects.
A 90km gas pipeline will link the FPSO to the Israeli coast and necessary onshore facilities to allow connection to the domestic sales gas grid operated by INGL, the national gas transmission company.
The entire project infrastructure has been contracted to be engineered, built and commissioned under a lump sum EPCIC Contract with Technip FMC, with a contracted delivery date of Q1 2021.
During 2019, three wells will be drilled into the Karish discovery, using the Stena Forth Drill Ship which is under contract from Energean. The Company has also secured options to drill five further wells in the licences Energean holds in Israel.