Page 11 - MEOG Week 38
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MEOG PROJECTS & COMPANIES MEOG
Energean prepares to resume
exploration after signing gas deals
ISRAEL LONDON-LISTED Energean last week said Shikun & Binui and Edeltech Group. The deals
that it would resume exploratory drilling next take the total amount of contracted sales gas
year, following the signing of two gas sales deals from Karish to 7 bcm per year, leaving 1 bcm
worth more than $2.5bn. available.
The company’s CEO, Mathios Rigas, told Speaking to Upstream, Rigas said that the
Upstream that Energean planned to secure a rig development of Tanin had been delayed as the
in late 2021 in preparation for drilling at the Ath- company had prioritised the cheaper Karish
ena and Zeus prospects in Block 12 once Karish North. He said that Karish North would likely
comes into production via FPSO a few months cost $150-200mn, while capex for Tanin is esti-
earlier. mated to be around $900mn.
He was quoted by Upstream as saying: “We’re He said: “Karish North is pushing back Tanin.
very confident about the resources,” noting that Our next step will be to drill the Athena and Zeus
the company hopes to discover 28.3-42.45bn prospects. If successful, we expect that would
cubic metres of gas. Rigas added that the chances allow us to push Tanin even further back.”
of success for the exploration wells are thought to The company estimates Karish North to hold
be around 70%. around 34 bcm of gas and roughly 39mn barrels
The prospects located close to Karish and of liquids, though a new competent person’s
could be tapped through tie-backs rather than a report (CPR) is due to be released in the next
separate unit, thereby reducing the cost of devel- month.
oping any potential finds. Rigas told Upstream
that unlike at Karish and Tanin, which were
acquired from Delek Group, Energean would
not have to pay the Israeli firm any royalties at
Block 12.
Meanwhile, the gas sales agreements were
signed entailing the provision of 1.4 bcm of gas to
the Ramat Hovay power plant partnership over a
period of 20 years.
Ramat Hovay is a venture between Israel’s
Fitch affirms Aramco’s long-
term issuer default rating
ISRAEL RATINGS agency Fitch affirmed Saudi Aram- to $33bn in 2019.
co’s long-term issuer default rating at A assigning Aramco’s business profile remains very
it a stable outlook. Aramco is the world’s largest strong.
oil producer. According to Fitch, its lifting costs were $2.8/
The company’s rating is driven by its conserv- barrels of oil equivalent (boe) and upstream
ative financial profile leaving it with a net cash capex of $4.7/boe in 2019, on a par with southern
position at end-2019. Iraq and among the lowest in the world.
Saudi Arabia has agreed with other OPEC+ Aramco’s business profile also benefits from
countries to make significant production cuts in a very large scale of production and vast proved
2020-2022 to re-balance the global oil market. reserve life in excess of 50 years.
Fitch estimates Aramco’s liquids production However, as would be expected from a com-
to fall by about 7% year-on-year in 2020 before pany whose business is oil production, it is more
rebounding gradually in 2021-2022, but, expects exposed to energy transition risk than other oil
the company to benefit from stabilised oil prices. majors as it is less integrated into natural gas and
The company was also able to revise down its is not planning to diversify into renewables on a
capex budget to $25bn-$30bn in 2020, compared large scale.
Week 38 23•September•2020 www. NEWSBASE .com P11
