The Greek Ministry of Environment and Energy and Energean Oil & Gas SA have agreed to the conversion of the West Katakolon exploration license to a 25-year exploitation license effective immediately.
West Katakolon is part of the Katakolon concession area and covers 60 sq km with 10 million bbl of recoverable oil. Energean will be operator of the field development, which follows that of its operated Prinos oil field and South Kavala gas field, both in the North Aegean Sea.
A field development plan (FDP) for West Katakolon will be submitted to the energy ministry by the end of February. Drilling is planned for 2018 and will use extended-reach drilling technology to drill from onshore to offshore reservoirs. Production startup is expected in 2018-19.
“We are committing to the $50-million investment in Katakolon as a first step in seeking to open up the oil and gas opportunities in this highly promising territory, an area with similar geology to the wider Adriatic Zone, well known for its prolific hydrocarbon systems in Italy, Albania, and Croatia,” said Mathios Rigas, Energean chief executive officer.
The FDP for West Katakolon will be Energean’s third offshore plan in process over the next few years after those of the 15 million-bbl Epsilon oil field, also in the Prinos concession, and the 2.4-tcf Karish and Tanin gas fields offshore Israel, recently acquired from Delek Drilling LP and Avner Oil Exploration LP for $148 million (OGJ Online, Aug. 19, 2016).
“During what has been a challenging period for the industry, Energean has taken advantage of its strong cashflow from Prinos to make sure it is well placed for a recovery in the oil price,” Rigas said. Production from Prinos has reached 5,000 b/d and “Energean is aiming to increase this to 10,000 [b/d] by 2018 through an ongoing $200 million investment program with low breakeven costs.
“We have acquired two new licenses in western Greece, been awarded two blocks offshore Montenegro and one more onshore western Greece, and most recently purchased the Karish and Tanin natural gas fields in Israel,” Rigas added. Energean also is preparing for exploration drilling on Egypt’s onshore West Kom Ombo block in the next few months.
