GSP Jupiter rig towed to Epsilon Oil Field (7/2018) - Photo from Energean official website
CAIRO – 6 July 2019: The Mediterranean-focused oil and gas producer Energean has announced entering into a conditional sale and purchase agreement to acquire Edison Exploration & Production S.p.A. (“Edison E&P”) for US$750 million.
The acquisition is believed to significantly expand Energean’s operations in the eastern Mediterranean gas hub, especially in Egypt’s offshore. Edison E&P’s Egyptian portfolio is full-cycle, consisting of production at the 100% owned and operated Abu Qir field, development at the 100% owned and operated NEA field and exploration optionality that most notably includes three wells that are expected to spud before year end 2019.
“The acquisition of Edison E&P establishes Energean as the leading independent, gas focused E&P company in the Mediterranean with a mainly operated, low cost, gas weighted portfolio, with the capability, focus and team to prosper in our rapidly changing industry. It will diversify Energean into a multi-country, multi-asset, full-cycle E&P company with scale, material cash flows, significant growth and portfolio optionality.
Edison E&P brings with it an exceptional team and I look forward to working with them as we build on the multiple opportunities ahead of us,” said Mathios Rigas, Chief Executive of Energean, according to a press statement obtained by Egypt Today.
Edison E&P’s portfolio of assets includes producing assets in Egypt, Italy, Algeria, the UK North Sea and Croatia, development assets in Egypt, Italy and Norway and balanced-risk exploration opportunities across the portfolio. The Edison E&P portfolio adds working interest 2P reserves of 292 mmboe and 2018 net working interest production of 69 kboe/d.
Gas contributed 76% of Edison E&P’s 2P reserves and 80% of its 2018 production, which complements Energean’s stated, gas-focused transition fuel growth strategy. The acquisition renders Energean one of the largest independent E&P companies on the London Stock Exchanges.
Edison E&P has been operating Abu Qir since it won the license tender in 2008, and this 10+ year track record of operating this low-risk producing asset reinforces the ability to realise further upside from infill drilling opportunities that can be developed quickly and cost effectively using existing infrastructure.
Per the agreement, Edison E&P will add 2018 EBITDAX of US$434 million and Operating Cash Flow of US$302 million, materially enhancing Energean’s current cash flow ahead of Karish and Tanin First Gas.
Energean will in due course send a circular to Energean Shareholders convening a general meeting to approve the Acquisition.
Energean is a London Premium Listed FTSE 250 and Tel Aviv Listed E&P company with operations offshore Israel, Greece and the Adriatic. Energean has 347 mmboe of 2P reserves and 58 mmboe of 2C resources across its portfolio.