Energean to go ahead with subsea project offshore Egypt

The NEA concession contains two discovered and appraised gas fields (Yazzi and Python) while the NI concession contains four discovered gas fields, one of which is readied for development. NEA/NI is due to deliver first gas in 2H22 with 49 million boe of 2P reserves, 87% of which is gas and peak production is expected to be approximately 90 million standard ft³/d plus 1000 bpd of condensates.

When Brent prices are above US$40/bbl, gas will be sold at US$4.6/million btu, which is the highest achieved to date for shallow water gas production, offshore Egypt.

Total CAPEX is expected to be approximately US$235 million, the majority of which is expected to be incurred in 2022 and TechnipFMC has been awarded the EPIC contract to deliver the project.

The NEA/NI drilling campaign is expected to be integrated with a broader Abu Qir drilling campaign, providing synergies on CAPEX.

As reported by Reuters, the company has also said that the first gas from its flagship Israeli fields, due to start flowing at the end of this year, could slip by two to three months.

The company said this was due to delays to increasing the workforce that is building its floating production, storage and offloading vessel in Singapore, which was due to sail to Israel towards the end of 3Q21.

Energean said this was primarily due to Covid-19 working conditions.

“Energean and its contractors are in ongoing discussions to achieve the required workforce numbers to deliver first gas around year-end,” the company said. “However, in the case that no further ramp up in the workforce is achieved, first gas could slip by between two and three months, into 1Q 2022.”

Energean also said it believed that these schedule adjustments would be likely to be the subject of an extension of time claim under force majeure.

The eastern Mediterranean-focused company plans to spend US$515 million to US$590 million this year, with the bulk intended to get the Karish gas field, offshore Israel, onstream.

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