Energean signs $2b gas contract with Eshkol power station

Eshkol Power Station  credit: PR
Eshkol Power Station credit: PR

The contract is for the supply of up to 12 BCM of gas over fifteen years.

Energean (TASE: ENOG; LSE: ENOG) announced today that it had signed a new agreement for the sale of gas in an initial quantity of 0.6 BCM annually to the Eshkol power station, with the quantity rising to 1 BCM from 2032.

The Eshkol power station was bought by Dalia Energy (TASE: DALIA) from the Israel Electric Corporation for NIS 9 billion after an auction that became the subject of a prolonged court proceeding. Dalia Energy will take over the power station in June this year.

The contract with Energean is for fifteen years for a total of up to 12 BCM, and is worth up to $2 billion. Energean will supply gas to all the former Israel Electric Corporation power stations that have been privatized: Ramat Hovav, Alon Tavor, Hagit Mizrach, and Eshkol.

Energean has also announced that the first gas has successfully been produced from the Karish North well, bringing the number of wells operated by Energean’s floating platform to four.

Energean CEO Mathios Rigas said, "Energean has successfully delivered another milestone in bringing our fourth well, Karish North, to first production. This provides us operational flexibility and enables us to utilize the FPSO's maximum gas capacity.

"The new contract with Eshkol is a further testament to the trust in Energean from the Israeli electricity producers, adds circa $2 billion of revenues over the life of the contract to our business, and is in line with our strategy to secure long-term reliable cash flows from long-term gas contracts."

Published by Globes, Israel business news - en.globes.co.il - on February 29, 2024.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2024.

Eshkol Power Station  credit: PR
Eshkol Power Station credit: PR
Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018