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    Energean earnings double in 2021 on higher prices, output


The company says the Karish field is on track to start up in the third quarter of this year.

by: Joseph Murphy

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Natural Gas & LNG News, Middle East, Top Stories, Corporate, Exploration & Production, News By Country, Israel, Israel

Energean earnings double in 2021 on higher prices, output

Mediterranean-focused Energean managed to nearly double its core earnings in 2021, the company reported on January 18, on the back of high gas prices and higher-than-expected production.

The company generated $202.9mn of EBITDA during the year, versus $107.7mn in 2020. Revenues totalled $495mn, versus $335.9mn in the previous year.

"2021 was an outstanding year for Energean, one in which we delivered excellent operational and record financial results," CEO Mathios Rigas said. "Production came in above initial expectations and we recognised all-time-high gas prices in Italy."

Energean produced 41,000 barrels of oil equivalent/day in 2021, above initial expectations and representing the midpoint in its revised guidance of 40,000-42,000 boe/d for the year.  The company said its flagship Karish gas field off Israel was still on track to start up in the third quarter of 2022, noting that the project was 92.5% complete as of December 31, 2021.

Energean raised more than $3bn from debt capital markets during the year, to refinance its existing borrowings and boost its liquidity.

"In doing so, we extended our weighted average maturity to approximately six years, pushed out commencement of major debt repayment obligations to 2024 and converted floating interest rates to fixed rates," Rigas said. "We end the year with over $1bn of liquidity, ensuring we are fully funded to deliver our projects and a sustainable dividend - the policy for which we expect to announce in March with our annual results."

Other highlights during the year included Energean's securing of a €100mn ($114mn) funding package from the Greek state to pay for the Epsilon oilfield off Greece.

Looking ahead, Energean expects to produce 25,000-30,000 boe/d of oil and gas in Israel in 2022, depending on exactly when Karish is launched and how quickly the field ramps up, plus a further 35,000-40,000 boe/d in other countries.  Besides work at Karish, it plans to launch a high-impact exploration drilling campaign off Israel in March 2022 and achieve first gas at the NEA/NI project in Egypt in the second half of the year.

Energean expects its capital expenditure to come to $710-760mn in 2022, versus $359mn in 2021.