Energean cashes in €883mn from Croatia, Egypt and Italy asset sale

Oil and gas company Energean has finalised a major deal to sell its assets in Egypt, Italy and Croatia to Carlyle International Energy Partners for up to €883mn, the company announced on June 20. 

The transaction marks a threefold return on investment for Energean, which snapped up the portfolio for a mere €265mn in 2020. With €766mn firmly secured, the deal is set to conclude by the end of 2024, subject to regulatory nods and antitrust clearances.

Energean’s decision to offload these assets is part of a strategy to put its focus on core gas development projects. This includes prioritising assets like the Karish Field in Israel and the Anchois field in Morocco. By concentrating on gas development, Energean aims to make its assets more profitable, increase cash flow and provide stronger returns to shareholders.

Beyond the financial gains, the sale optimises Energean's portfolio by shedding older assets and reducing over 60% of its decommissioning liabilities, the company said. The move is expected to improve short to medium-term cash flow, providing Energean with greater financial flexibility to pursue future growth opportunities.

Post-sale, the company intends to maintain and expand its presence in the Mediterranean region and explore opportunities in Europe, the Middle East and Africa (EMEA). Energean is eyeing territories where there is robust policy support for gas and initiatives to phase out coal. The company is also committed to creating a carbon storage hub in Greece and the broader Mediterranean region via its EnEarth subsidiary.

Mathios Rigas, the CEO of Energean, stated: “This transaction unlocks management capacity and financial flexibility to drive future growth. Our focus will now be on creating enhanced value from our Israeli assets and scouting for new opportunities that align with Energean’s core objectives: reliable dividends, deleveraging, growth, and our pledge to Net Zero.”

Rigas praised Carlyle International Energy Partners as the right steward for the acquired assets and thanked Energean's teams in Egypt, Italy, and Croatia for their dedication over the years.

Bob Maguire, co-head of Carlyle International Energy Partners, said: “We are thrilled to acquire this portfolio of top-tier assets in Italy, Egypt, and Croatia. These countries are at the forefront of encouraging new gas development, which we believe will play a pivotal role in the energy transition.”

Maguire plans to develop these assets into a scalable exploration and production platform in the Mediterranean. This strategy includes immediate developments, growth opportunities, mergers and acquisitions, and advancing existing decarbonisation plans.