Energean Unveils Offshore Katlan Investment in Israel

Energean plc has announced the Final Investment Decision (FID) for the Katlan development project in Israel. The project will be developed in phases, utilizing a subsea tieback to the existing Energean Power FPSO. This development will extend the production plateau from the FPSO, with volumes exempt from seller royalties and export restrictions. It aims to support Energean's existing gas sales agreements while targeting international markets. The first gas production is planned for the first half of 2027.

The EPCI contract for the subsea scope of the Katlan development project has been awarded to TechnipFMC. It includes a four-well-slot tieback capacity to a single large ~30-kilometer production line, which will support future Katlan area phases. The project's capital expenditure is projected to be approximately $1.2 billion, covering the subsea infrastructure, an upgrade of the FPSO topsides related to MEG treatment, injection, and storage (benefiting future subsea tie-back developments), and the drilling of the first two production wells.

Energean also revealed that the Ministry of Energy and Infrastructure has granted a 30-year lease for the Katlan area, which includes a 20-year extension option. This lease approval is a significant milestone, ensuring long-term operational stability for the Katlan development project. The Ministry has formally approved the Hermes discovery, now designated as the Drakon area within Block 31, which was identified during the 2022 exploration campaign. This ratification not only validates Energean's exploration efforts but also enhances the company's resource base, potentially unlocking further development opportunities in the region. The combined approvals reinforce Energean's strategic position and commitment to energy development in Israel.

Mathios Rigas, Chief Executive Officer of Energean, expressed enthusiasm about the latest milestone in Energean’s growth trajectory, emphasizing the company’s commitment to swift development and production of gas assets. Rigas highlighted that the Ministry's official granting of the 30-year lease for Katlan, along with the confirmation of the 2022 Hermes discovery, de-risks nearby accumulations and underscores the potential in the newly named Drakon area. He noted that developing Katlan will unlock further value in the Israeli subsurface, contributing to additional energy security and driving sustainable development in Israel and the broader region.

The Katlan area, discovered by Energean in 2022, is wholly owned and operated by Energean under the I/21 Katlan Lease. The fields, located in water depths of up to 1,800 meters, are part of a significant development plan. Phase 1, encompassing the Athena, Zeus, Hera, and Apollo fields with an estimated 229 mmboe, including 35 bcm of gas, received approval from the Israeli Government in December 2023. This development highlights Energean's commitment to expanding its resource base and contributing to the region's energy security.

The wider Katlan area holds an additional 223 mmboe, including 34 bcm of gas, in prospective volumes across other accumulations, which Energean considers substantially de-risked. These volumes will be developed in subsequent phases, requiring a shorter pipeline to connect to the Phase 1 pipeline.