BP to buy out entire Prinos oil output

Oil giant British Petroleum has expressed an interest in acquiring the oil output from the Prinos field in the northern Aegean, which is extracted by Greek company Energean Oil & Gas.

The multinational has already bought a load totaling 300,000 barrels, whose collection was completed last Tuesday by the tanker Ivory Point, which is now destined for an oil refinery at Marseille in southern France.

The negotiations with Energean concern a six-year contract for the buyout of the entire Prinos output, which currently amounts to 2,000 barrels per day and is expected to grow to 4,000 barrels per day by the end of the year. The output increase will stem from new drillings scheduled by the company. A rig is expected to arrived in the second week of July for that purpose.

Energean sources say that the completion of the deal with BP will depend on whether the Greek company will be able to disengage itself from a term in the 1999 contract that forces state-owned Hellenic Petroleum (ELPE) to acquire the Prinos output. This term was ushered in to ensure the continuation of the Prinos oil unit’s operations following the departure of Canadian company Denison after prices plummeted to below $10 per barrel.

The sale of the first load was made possible thanks to ELPE’s approval. ELPE and Energean have started talks aimed at removing that term, Energean sources have told Kathimerini. They added that the approval of the first load is a good sign.

BP had been the main buyer of the Prinos oil output during Denison’s involvement. The return of the multinational to the Greek reserve is attributed by energy market insiders to the general interest BP is showing in the domestic hydrocarbon market that has reopened after 15 years with very encouraging signs. It is already known that BP has also expressed an informal interest in Greek hydrocarbons to government officials. The recent entry of US fund Third Point into Energean’s share capital with $60 million is also connected to developments in the domestic hydrocarbon market.