Energean Oil & Gas PLC Sell E&P North Sea Assets for up to $280 million

energean oil and gas

Energean Oil and Gas plc (LON: ENOG, TASE: אנאג), the oil and gas producer focused on the Mediterranean, has announced that, further to Energean’s proposed acquisition of Edison Exploration and Production S.p.A. as announced on 4th July 2019, it has entered into a conditional Sale and Purchase Agreement to sell Edison E&P’s UK and Norwegian subsidiaries to Neptune Energy Group Holdings Limited for $250 million of cash, to be adjusted for working capital (effective date 1st January 2019), with additional cash contingent consideration of up to $30 million1. The sale is contingent on Energean completing its proposal to acquire Edison E&P and is expected to close as soon as is reasonably practicable thereafter.

The onward sale is in line with Energean’s stated strategy of becoming the largest independent gas-focused E&P Company in the Mediterranean, and its previously stated intention to dispose of non-core assets. The net proceeds further strengthen Energean’s balance sheet and provide additional financial flexibility across the expanded portfolio.

The Edison E&P UK and Norway subsidiaries include the Nova (15% Working Interest) and Dvalin (10% Working Interest) gas developments offshore Norway, and in the UK, the producing Scott (10.5% Working Interest), Telford (15.7% Working Interest), Tors (68% Working Interest) and Wenlock (80% Working Interest) fields, the Markham asset (3.1% Working Interest), the Glengorm discovery (25% Working Interest) and the Isabella licence (10% Working Interest), upon which an exploration well is expected to spud in the coming weeks. Combined, the subsidiaries represent $408 million of 2018 Gross Assets and $33 million of 2018 Losses before Tax.

Neptune will take on the Edison UK and Norway employees and has agreed to guarantee their terms of employment and severance pay for a period of 18 months from Completion.

Mathios Rigas, Chief Executive of Energean Oil & Gas, commented:

“The acquisition of Edison E&P established Energean as the leading independent, gas-focused E&P Company in the Mediterranean with a mainly-operated, low-cost, gas-weighted portfolio and a highly experienced team to prosper in our rapidly changing industry. At the time of announcement, we committed to our Shareholders that we would seek to dispose of non-core assets that do not adhere to our strategy. I am delighted to be able to make this announcement today, which demonstrates our commitment and capability to deliver upon our stated goals. Neptune is a leading player in the UK and Norway upstream sectors and, as such, we are convinced that under Neptune’s ownership, Edison E&P’s UK and Norway teams will benefit from the increased focus and investment that will result from this strategic alignment.”


(1) The $30 million of contingent consideration becomes payable under the following conditions:

i) In respect of the Glengorm field, Neptune will pay an additional $0.5/boe for any net 2P reserves in excess of 16 million barrels of oil equivalent in a Field Development Plan which is approved by the Oil & Gas Authority by 31 December 2025, up to a maximum of $30 million

ii) To the extent that the above contingent consideration, relating to the Glengorm field, has not reached $30 million, Neptune will pay additional contingent consideration of $0.5/boe of net 2P Isabella reserves in a Field Development Plan for Isabella which is approved by the Oil & Gas Authority by 31 December 2026.

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