Energean has announced the commencement of natural gas production at the Karish North discovery offshore Israel. 

The first gas from Karish North was achieved on 22 February 2024, utilising the recently installed second gas export riser. 

With the commencement of production, the Energean Power FPSO unit now operates four production wells, enhancing the system's redundancy and flexibility.  

It is anticipated that this expansion will enable Energean to better meet the demand requirements of its natural gas buyers.  

The start of gas exports from Karish North has enabled the FPSO to utilise its maximum gas capacity of eight billion cubic metres per annum (bcmpa). 

According to GlobalData, production from the Karish North conventional gas development project is expected to peak in 2029.  

Under current economic assumptions, the field's production is expected to continue until it reaches its economic limit in 2050. 

Concurrently, Energean Israel signed a new GSPA with Eshkol Energies Generation.  

The initial supply will be 0.6bcmpa, increasing to 1bcmpa from 2032 onwards.  

This agreement aligns with Energean's strategy to secure long-term cash flows for its shareholders through long-term gas contracts. 

The GSPA, which spans approximately 15 years, is for a total contract quantity of up to approximately 12bcm.  

This contract represents around $2bn in revenues over its lifetime.  

It includes provisions for floor and ceiling pricing, take-or-pay commitments and price indexation, which notably is not linked to Brent crude prices.  

Energean CEO Mathios Rigas said: “Energean has successfully delivered another milestone in bringing our fourth well, Karish North, to first production. This provides us operational flexibility and enables us to utilise the FPSO’s maximum gas capacity.  

“The new contract with Eshkol is a further testament to the trust in Energean from the Israeli electricity producers, adds circa $2bn of revenues over the life of the contract to our business, and is in line with our strategy to secure long-term reliable cash flows from long-term gas contracts.”