Tuesday 18 December 2018

Energean Oil and Gas plc announced it has signed a Memorandum of Understanding (“MOU”) with Israel Natural Gas Lines (“INGL”) for the construction and transfer of the near shore and onshore part of the infrastructure that will deliver gas from the Karish and Tanin FPSO into the Israeli national gas transmission grid.

Energean will be paid 369 million Israeli New Shekels, approximately US$98 million, 15% of which is expected to contribute to the Company’s available liquidity between now and end 1Q 2019. Another 80% is expected to become available at handover of the infrastructure in 2021, with the remaining 5% due following an 18 month warranty period.

The MOU covers the onshore section of the Karish and Tanin infrastructure and the near shore section of pipeline extending to approximately 10km offshore. The hand over to INGL will occur shortly after the delivery of first gas from the Karish field in 1Q 2021. Following handover, INGL will be responsible for the operation and maintenance of this part of the infrastructure. Energean will not incur any charges or tariffs for use of this infrastructure.

Energean expects the detailed agreement to be signed in 1Q 2019.