Israel’s first-ever stream of crude oil exports to global markets was launched from Energean’s Karish development in the eastern Mediterranean.
The crude shipment was loaded this week from the Energean Power Floating Production Storage and Offloading unit, a giant vessel used to develop the Karish gasfield.
Energean’s FPSO is part of a development that has been politically controversial because of its location on a once-disputed maritime border between Israeli and Lebanese waters.
Energean started production at Karish late last year.
Vitol, the world’s largest independent oil trader, has a deal to offtake and market the Karish cargoes internationally, Energean said.
Energean, listed in London, has grown rapidly since being founded by Greek banker Mathios Rigas in 2007.
Its shares have roughly doubled since 2019, giving it a market capitalisation of £2.2bn.
Energean’s CEO said: “We are happy and proud that Energean has facilitated Israel joining the club of international oil exporters.
“This is another milestone for us, enhancing Energean’s growth as a significant player in the local and regional markets.”
Nick Witney, Energean Group Commercial Director, said: “While we remain a gas-focused company, with our Israeli gas production central to our role in enabling the energy transition, light, sweet crude oil responsibly produced from modern, low carbon intensity facilities is very much in demand, globally.”
Israel is now self-sufficient in natural gas, which has reduced its reliance on coal and helped smooth ties with its neighbours through export agreements to Egypt and Jordan, although it still imports most of its crude oil.
While Karish is primarily a gasfield, the success of its associated oil production is crucial to the economics of the project for Energean, according to people familiar with the matter.
The price Energean receives for the gas it produces at Karish is lower than international prices because Israel is a relatively isolated market.
But the associated oil can be shipped internationally by tanker, with Energean expected to get closer to the global price for its crude, which will be known as Karish Blend.
The Greek energy firm said it was still open to exporting its Israeli gas to Cyprus, which is behind schedule in importing natgas.
“Exporting to Cyprus and, possibly, from Cyprus to other markets via an FLNG is one of the options under consideration for the additional gas we have discovered in Israel,” Energean spokesperson Sotiris Chiotakis told the Financial Mirror.
He said the other two options are “exporting to Egypt and/or increasing quantities for the Israeli market. One option does not exclude the other”.
Chiotakis said that within the first half of 2023, Energean plans to present “a specific development project for the additional 67 BCM we have discovered or derisked in the so-called Olympus Area, offshore Israel”.