Energean To Transfer Pipes to Israeli Grid

Greek producer, Energean Oil and Gas, has signed an agreement with Israel’s gas transmission operator to transfer ownership of infrastructure.

Energean said December 17 that it has signed a Memorandum of Understanding with Israel Natural Gas Lines (INGL) that will result in $98mn (new shekels 369mn) of cash inflow for Energean. The agreement is for the transfer of title of the near shore (up to 10km offshore) and onshore part of the infrastructure that will deliver gas from the Karish/Tanin floating production ship (FPSO) into the Israeli gas transmission grid. Energean expects to sign the final agreement in 1Q 2019.

Energean expects 15% of the consideration to be paid in early 2019, followed by 80% at actual handover, with the remaining 5% due following an 18 month warranty period. The handover to INGL will become effective shortly after the delivery of first gas from the Karish field in 1Q 2021. Energean will not incur any charges or tariffs for the use of this infrastructure.

The Karish and Tanin fields are being developed by Energean Israel, a joint venture between Energean with 70% and private equity fund, Kerogen, with 30%.