Energean Oil & Gas sinks after update

Shares in FTSE 250 explorer Energean Oil & Gas (LON:ENOG) fell by 2.92% to 799p (as of 12:40 GMT) as costs dwarfed revenues in 2019. Management said that they were reviewing the Prinos Area assets and that the sale of its North Sea assets would be sold as soon as possible in 2020.

CEO Mathias Riga commented: “Karish and Tanin is on track to deliver first gas in 1H 2021 and we have now secured 5.0 bcm/yr of firmly contracted gas sales to Israeli domestic buyers, 1.3 bcm/yr of contingent gas sales and 2.0 bcm/yr of potential sales to be discussed under a Letter of Intent with Greece’s DEPA. With the above we are fast approaching our goal to fill the capacity of the Energean Power. We are already looking at growth opportunities on the resource side from our nine blocks in Israel and on potential additional infrastructure capacity that will allow us to expand gas sales in the region. With the expected closing of the acquisition of Edison E&P and subsequent sale of the North Sea assets to Neptune, we will further enhance our position in our core markets, substantially increase our reserves and production and realise immediate operating cash flow. Post completion, the combined portfolio will establish a material long-term cash flow profile that supports our ambition to pay a sustainable dividend.

I look forward to continuing this positive momentum in 2020, with a key focus on delivering Karish; closing and integrating Edison E&P; and continuing the sustainable growth of Energean, maximising value for all of our stakeholders“.