(Reuters) – Israel-focused gas driller Energean <ENOG.L> said on Thursday it will buy Italian energy group Edison’s <EDNn.MI> oil and natural gas unit for an initial consideration of $750 million (596.14 million pounds).
The acquisition would significantly expand Energean’s operations in the growing eastern Mediterranean gas hub, with a significant presence in Egypt’s offshore basin.
Energean said it will likely pay an additional $100 million after gas production from the Cassiopea field in offshore Italy begins, which is expected in 2022.
Reuters reported on Wednesday that Energean was the frontrunner to acquire these assets.
Energean expects the expanded group to produce over 140 kilobarrels of oil equivalent per day (kboed/d) in 2021 when the Karish and Tanin development projects come onstream.
The London-listed driller said Edison’s portfolio, which includes assets in Italy, Algeria, Croatia, the British and Norwegian North Sea as well as Greece, adds net working interest production of 69 kboed/d.
Energean said it will finance the initial consideration for the deal through a short-term loan facility of $600 million and up to $265 million through equity financing.
(Reporting by Tanishaa Nadkar and Shariq Khan in Bengaluru; Editing by Arun Koyyur)