Energean Signs GBP78 Million Agreement With Israel Natural Gas Lines

LONDON (Alliance News) - Energean Oil & Gas PLC on Monday said it signed an memorandum of ...

Alliance News 17 December, 2018 | 9:04AM
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LONDON (Alliance News) - Energean Oil & Gas PLC on Monday said it signed an memorandum of understanding with Israel Natural Gas Lines Ltd, which is expected to result in GBP78 million of cash inflow for the exploration company.

Israel Natural Gas Lines is an Israeli government owned company that operates gas transportation systems.

The FTSE 250 constituent said the deal is for the transfer of title to the near-shore and onshore part of the infrastructure that will deliver gas from the Karish and Tanin fields into the Israeli national gas transmission grid.

Energean expects the detailed agreement to be signed in the first quarter of 2019.

Under its terms, Israel Natural Gas Lines will pay Energean a total ILS369 million, about GBP78 million. Energean said it will receive 15% of this in early 2019. Another 80% will come on handover and the remaining 5% after 18 months.

It is intended that the hand over to Israel Natural Gas Lines will become effective shortly after the delivery of first gas from the Karish field in the first quarter of 2021.

Following hand over, Israel Natural Gas Lines will be responsible for the operation and maintenance of the Karish and Tanin infrastructure. Energean will not incur any charges or tariffs for use of this infrastructure.

"The memorandum of understanding is an important milestone for the Karish and Tanin development," said Energean Chief Executive Mathios Rigas.

"Our collaboration with Israel Natural Gas Lines demonstrates the Israeli government's support and commitment to the Karish Tanin project, from which natural gas will flow to the Israeli market from the first quarter of 2021," added Rigas.

Energean shares were trading 2.1% higher on Monday morning at 581.00 pence each.

By Evelina Grecenko; evelinagrecenko@alliancenews.com

Copyright 2018 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article
Security Name Price Change (%) Morningstar Rating
Energean Oil & Gas PLC 785.00 -
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