BP deal allows Energean to step up investments

BP Plc’s decision to buy all of Energean Oil & Gas SA’s Aegean Sea production will help Greece’s only oil producer attract international loans to spur investment, Chief Executive Officer Mathios Rigas said.

“The deal with BP is a huge step toward putting Greek crude on the world oil map,” Rigas said in an interview in Athens.

“With BP doing the marketing, crude oil from the Prinos field will get recognized by, and access to, international markets, and that will enable us to approach international banks for financing.”

On January 13 Energean signed a six-year deal with BP Oil International valued at $500 million based on projected oil production at current prices.

The Greek government agreed on the same day to eliminate a requirement that Energean sell output to local refiner Hellenic Petroleum SA.

Energean plans to invest 150 million euros in 2014 and 2015, in part to tap the Epsilon satellite field and lift daily production at Prinos, with the aim of increasing total production in the Kavala Gulf to 5,000 barrels by the end of the year from 2,500 today.

Proven recoverable reserves, including current production, stand at 24 million barrels, meaning the Prinos field still has 15 years of production left, Rigas said.