Energean's Profit Rises on Israel Output Boost, Despite Market Challenges
(Reuters) — Gas producer Energean reported higher first-half profit on Wednesday, helped by a rise in production due to strong summer demand in Israel, which accounts for more than 70% of total output.
The company is looking to expand in Europe, Middle East and Africa, particularly where there is long-term policy support for gas and displacement of coal.
The company had agreed in June to sell its assets in Egypt, Italy and Croatia to private equity fund Carlyle for up to $945 million.
Energean expects to pay a special dividend of up to $200 million following the completion of this deal, which is expected by the end of the year.
The company said production for the first-half rose 38% to 146 thousand barrels of oil equivalent (kboepd), from last year, with the Karish and Karish North fields in Israel.
Its realised average gas price fell 12% to $4.6 per thousand cubic feet (mcf) for the period.
Day-to-day production in Israel continues to be unaffected by the ongoing conflict. CEO Mathios Rigas told Reuters that Energean's operational costs in the country have increased on the back of higher wages due to risk premiums and rising insurance costs.
The group narrowed its production forecast for the year to 155 - 165 kboepd from an earlier outlook of 155-175 kboepd, to reflect year-to-date performance in Israel and the actual start-date and expected ramp-up to full production of Cassiopea offshore Italy.
"On first pass these appear to be a reassuring set of results, in the face of a challenging macro and political backdrop," said Peel Hunt analyst Werner Riding.
Energean's shares slipped 0.2% to 884p by 0737 GMT.
Energean aims to double its production in the coming years, primarily through development of new prospects in Israel, including the Katlan field.
The company in July also said it would invest about $1.2 billion to develop the Katlan project off Israel, as it announced its final investment decision, with gas output expected to commence in the first half of 2027.
Energean reported a profit after tax of $89 million, or 48 cents per share, for the six-months ended June 30, from $70 million, or 39 cents per share last year.
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