Energean sees higher 2024 output despite softer Israel gas demand

By Ron Bousso and Chandini Monnappa

LONDON (Reuters) -Mediterranean-focused Energean on Thursday forecast higher 2024 production, which was nevertheless affected by slower gas demand growth in Israel, after profit more than doubled last year.

The London- and Israel-listed firm expects 2024 production to be between 155,000 and 175,000 barrels of oil equivalent per day (boed), up from 123,000 boed in 2023, the first full year of operations of its Karish field offshore Israel.

The forecast is "primarily driven by Energean's gas demand outlook for 2024 in Israel, which has been influenced by the coal phase-out delays and warmer than average winter temperatures so far," the company said in a statement.

The production guidance was 10% below forecasts by analysts at Jefferies.

Energean shares were down 1.5% by 0930 GMT.

Production from the Karish North expansion phase was set to start in the first quarter of 2024, although a second oil production facility is now expected to be installed "as the security situation allows," the company said.

Energean, which operates in eight countries across the Mediterranean and the UK North Sea, said its day-to-day operations in Israel continued to be unaffected by the ongoing conflict in the region.

The company supplies gas to Israel and neighbouring Jordan via pipeline.

"But we're seeing the government holding back a bit on the phasing out of coal, which is understandable for security of supply," Energean CEO Mathios Rigas told Reuters.

Karish, which operated at nearly 100% capacity over the year, according to Rigas, supplied around 60% of Israel's gas demand after the Chevron-operated Tamar field was shut down for over a month due to security concerns in October.

The company's adjusted EBITDAX (earnings before interest, tax, depreciation, amortisation and exploration), a profit metric used by oil and gas companies, came in at $925 million for the year ended Dec. 31, compared with $422 million a year earlier.

(Reporting by Chandini Monnappa and Prerna Bedi in Bengaluru, Ron Bousso in London; Editing by Eileen Soreng and Jacqueline Wong)