Energean’s long-running acquisition deal of Edison E&P is expected to be finalized in December of this year, the company announced in a statement.
“We look forward to completing our acquisition of Edison E&P in December 2020, which, alongside Karish, will further secure our long-term, resilient cash flow profile and option-rich portfolio. Following completion of the deal, approximately 70% of our future production will be sold under long-term gas sales agreements that will largely insulate our revenues against commodity price volatility and enable us to realize our medium-term ambition to pay a meaningful and sustainable dividend,” CEO of Energean, Mathios Rigas, commented.
Energean increased the facility size of its Egypt Reserve Based Lending (RBL) by $60 million to $280 million, in which the sum will be directed towards Edison’s acquisition following transaction close, providing additional liquidity and flexibility over capital allocation. The company was granted several government approvals in Italy, Greece, and the UK. Currently, Energean awaits governmental approval from Egypt and France.
The acquisition faced several impediments along the way when the Algerian government hindered the sale of Edison E&P’s assets there, then afterward Neptune Energy backed out of the deal to buy the Norwegian and UK assets from Energean.
Additionally, Energean’s Egypt production recorded 36,600 barrels of oil equivalent per day (bbloe/d) in the first nine months of 2020, approximately 86% of which was gas about 1.4 billion cubic meters (bcm). Production remains within the company’s 2020 guidance of 34,000 – 37,000 bbloe/d in Egypt. Net receivables amounted to $213 million on September 30, while the company received $10 million in October.