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    Energean Finds More Offshore Israel

Summary

The well opens up new possibilities for the regional gas market.

by: William Powell

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Energean Finds More Offshore Israel

Energean Oil & Gas has found more gas with the Karish North exploration well, it said April 15. Preliminary analysis indicates between 1 trillion ft³ and 1.5 trillion ft³ gas in place, in high quality sands.

The well reached an intermediate depth of 4,880 metres about a week earlier than expected and found a gross hydrocarbon column of up to 249 metres. A 27-metre core was recovered to surface. Further evaluation will now be undertaken to further refine resource potential and determine the liquids content of the discovery, it said. As planned, Energean will now deepen the well to evaluate hydrocarbon potential at the D4 horizon.

Once operations are completed on Karish North, the Stena Drillmax will return to drilling the three Karish Main development wells. Energean will then have six drilling options remaining with Stena Drilling.

The Karish North discovery will be commercialised via a tie-back to the Energean Power floating production, storage and offtake vessel 5.4 km from the Karish North well. The FPSO is being built with total processing and export capacity of 8bn m³/yr.  

In December 2018, Energean signed a contract with IPM Beer Tuvia to supply an estimated 5.5bn m³ in total, and the discovery means that the contract is now likelier to becoming a firm sales agreement, it said.

Including that contract, Energean has contracted to sell 4.6bn m³/yr, leaving a further 3.4bn m³/yr of spare capacity in its FPSO for additional sales of discovered gas at Karish and the tie back of future discoveries.

CEO Mathios Rigas said the discovery demonstrated the attractiveness of its acreage offshore Israel: "We are building the Energean Power FPSO with spare capacity, which will enable us to quickly, safely and economically develop both Karish North and future discoveries. We have already signed a contingent contract to sell 5.5bn m³ of this new resource, and our strategy is now to secure the offtake for remaining volumes. We continue to see strong demand for our gas, which we believe will be supported by today's announcement."

Israel's energy minister Yuval Steinitz said: "The first exploration drilling following years of stagnation ended up with a discovery for Energean! I congratulate Energean for the significant amount of natural gas discovered in Karish North. This is a first sign, and I am sure that further discoveries will follow – and turn the state of Israel into a regional gas hub".

Elsewhere in the eastern Mediterranean, Egypt and Cyprus are also sitting on very large amounts of gas, but those offshore Cyprus are yet to be developed. Egypt also has liquefaction capacity and the country has become an exporter once more, thanks to the Zohr field. The US major ExxonMobil, which operates the Glaucus well offshore Cyprus in Block 10 (60%) with its partner Qatar Petroleum (40%), is reportedly in talks with Israeli producers about developing floating liquefaction capacity off Israel. The Glaucus well found up to 8 trillion ft³ of gas, ExxonMobil announced February 28.