Energean contracts Stena Drilling for Israeli offshore campaign

Energean has signed a contract with Stena Drilling for its 2022-2023 growth drilling program offshore Israel, which is expected to target the derisking of unrisked prospective recoverable resources of over 1 billion BOE.

The contract is for the drilling of three firm wells and two optional wells, with the first firm well expected to spud in Q1 2022. The firm wells are all expected to be drilled during 2022, and consist of:

• The Karish North development well, a key part of the Karish North development. The scope includes re-entry, sidetracking and completion of the previously drilled Karish North well and completion as a producer. The Karish North development will commercialize 33 billion cu m (1.2 trillion cu ft) of gas plus 31 million bbls of liquids 2P reserves (a total of 243 million BOE) and is expected to deliver first gas in the second half of 2023.
• The Karish Main-04 appraisal well, which is expected to target further prospective volumes within the Karish Main Block, including the potential oil rim that was identified as part of the KM-03 development well drilling. Total unrisked recoverable volumes estimated to be targeted by the well are 166 million BOE.
• The Athena exploration well, located in Block 12, is situated directly between the Karish and Tanin leases. Athena is estimated to contain unrisked recoverable prospective resource volumes of 20 billion cu m (0.7 trillion cu ft) of gas plus 4 million bbls of liquids; of which the primary target is estimated to contain unrisked recoverable prospective resource volumes of 10 billion cu m (0.4 trillion cu ft) of gas plus 2 million bbls of liquids with a 70% geological chance of success. Success at Athena would be expected to significantly de-risk approximately 90 billion cu m (2.5 trillion cu ft) plus 19 million bbls of remaining unrisked recoverable prospective resource volumes located within Block 12 and Tanin.

Two factors support the commercialization of a Block 12 discovery. Firstly, Block 12 was a new license award to Energean Israel in 2018; produced volumes will therefore generate no royalty payments in respect of Energean Israel’s original acquisition of the block. Secondly, the more proximate location of the potential development to the expected location of the Energean Power FPSO is also expected to reduce like-for-like development costs when compared with Tanin.

The drilling campaign will be undertaken using the Stena IceMAX, a harsh environment dual-activity dynamically positioned drillship, capable of drilling in water depths of up to 10,000 ft.