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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Energean Plc | LSE:ENOG | London | Ordinary Share | GB00BG12Y042 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| -20.00 | -1.85% | 1,064.00 | 1,063.00 | 1,065.00 | 1,095.00 | 1,064.00 | 1,095.00 | 138,228 | 14:08:15 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Crude Petroleum & Natural Gs | 1.42B | 184.94M | 0.4576 | 23.38 | 4.32B |
TIDMENOG
RNS Number : 9010N
Energean PLC
07 June 2022
Energean Israel Limited Unaudited interim condensed consolidated financial statements 3 1 M arch 20 22
ENERGEAN ISRAEL LIMITED
Unaudited interim condensed consolidated financial statements
AS OF 31 MARCH 2022
INDEX
Hot Features
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Page
-----
Interim condensed consolidated statement of financial
position 1
Interim condensed consolidated statement of comprehensive
income 2
Interim condensed consolidated statement of changes
in equity 3
Interim condensed consolidated statement of cash
flows 4
Notes to the interim condensed consolidated financial
statements 5-16
- - - - - - - - - - - - - - - - - - - -
ENERGEAN ISRAEL LIMITED
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Amounts in thousands US Dollars, unless otherwise stated)
31 March 31 December
2022 2021
---------- ------------
Unaudited Audited
---------- ------------
Note
--------
ASSETS:
NON-CURRENT ASSETS:
Property, plant and equipment 3(A) 2,333,706 2,245,267
Intangible assets 3(B) 25,314 20,141
Other accounts receivable 9,248 6,463
Loan to related party 346,000 346,000
Restricted cash 3(C)(2) 100,000 100,000
Deferred expenses 22,958 22,958
Deferred tax asset 5 12,902 11,575
---------- ------------
2,850,128 2,752,404
---------- ------------
CURRENT ASSETS:
Trade and other receivables 29,076 22,769
Restricted cash 3(C)(2) 35,617 99,729
Cash and cash equivalents 301,574 349,827
---------- ------------
366,267 472,325
---------- ------------
TOTAL ASSETS 3,216,395 3,224,729
========== ============
EQUITY AND LIABILITIES:
EQUITY:
Share capital 1,708 1,708
Share premium 572,539 572,539
Accumulated losses (37,470) (35,946)
---------- ------------
TOTAL EQUITY 536,777 538,301
---------- ------------
NON-CURRENT LIABILITIES:
Senior secured notes 3(C) 2,465,619 2,463,524
Provisions for decommissioning 35,696 35,525
Trade and other payables 3(E) 54,234 113,264
---------- ------------
2,555,549 2,612,313
---------- ------------
CURRENT LIABILITIES:
Trade and other payables 3(E) 70,158 74,115
Sales consideration received
in advance 3(E)(3) 53,911 -
---------- ------------
124,069 74,115
---------- ------------
TOTAL LIABILITIES 2,679,618 2,686,428
---------- ------------
TOTAL EQUITY AND LIABILITIES 3,216,395 3,224,729
========== ============
06 June 2022
------------- ----------------- ----------------
Panagiotis Benos Matthaios Rigas
Director Director
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
ENERGEAN ISRAEL LIMITED
INTERIM CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(Amounts in thousands US Dollars, unless otherwise stated)
For the For the
period of period of
three months three months
ended 31 ended 31
March 2022 March 2021
-------------- --------------
Unaudited Unaudited
-------------- --------------
Note
-----
Administrative expenses 4(A) (2,205) (878)
Other expenses 4(A) (824) (23)
Other income 4(A) 53 -
-------------- --------------
Operating loss (2,976) (901)
Finance income 4(B) 3,338 23
Finance expenses 4(B) (3,078) (157)
Foreign exchange gain (loss) 4(B) (68) 517
-------------- --------------
Loss for the period before tax (2,784) (518)
Tax income 5 1,260 173
-------------- --------------
Net loss for the period (1,524) (345)
-------------- --------------
Other comprehensive income (loss):
Items that may be reclassified subsequently
to profit or loss:
Gain (loss) on cash flow hedge for
the period - 2,269
Tax relating to items that may be
reclassified subsequently to profit
or loss - (522)
-------------- --------------
Other comprehensive income for the
period - 1,747
-------------- --------------
Total comprehensive income (loss)
for the period (1,524) 1,402
============== ==============
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
ENERGEAN ISRAEL LIMITED
INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(Amounts in thousands US Dollars, unless otherwise stated)
For the period of three months ended 31 March 2022 (Unaudited):
Share Share Accumulated Total
capital premium losses equity
--------- --------- ------------ --------
Balance as of 1 January 2022 1,708 572,539 (35,946) 538,301
Changes during period:
Comprehensive loss:
Loss for the period - - (1,524) (1,524)
--------- --------- ------------ --------
Balance as of 31 March 2022 1,708 572,539 (37,470) 536,777
========= ========= ============ ========
For the period of three months ended 31 March 2021 (Unaudited):
Share Share Other Accumulated Total
capital premium reserves losses equity
--------- --------- ---------- ------------ --------
Balance as of 1 January 2021 1,708 572,539 (5,328) (25,114) 543,805
Changes during period:
Comprehensive income (loss):
Loss for the period - - - (345) (345)
Other comprehensive loss, net
of tax - - 1,747 - 1,747
--------- --------- ---------- ------------ --------
Balance as of 31 March 2021 1,708 572,539 (3,581) (25,459) 545,207
========= ========= ========== ============ ========
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
ENERGEAN ISRAEL LIMITED
INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Amounts in thousands US Dollars, unless otherwise stated)
For the period For the period
of three months of three months
ended 31 March ended 31 March
2022 2021
----------------- -----------------
Unaudited Unaudited
----------------- -----------------
Cash flows from operating activities:
Loss for the period before tax (2,784) (518)
----------------- -----------------
Adjustments for:
Depreciation and amortisation 38 29
Loss from disposal on property, plant
and equipment 824 23
Other expenses 5 -
Other income (53) -
Decommissioning discount unwinding 171 138
Finance Income (3,338) (23)
Finance expenses 2,907 19
Net foreign exchange gain 68 (517)
----------------- -----------------
622 (331)
Changes in working capital:
Decrease (increase) in other receivables (2) 27
Increase in trade and other payables 800 270
----------------- -----------------
(1,364) (552)
Income taxes paid (330) -
----------------- -----------------
Net cash used in operating activities (1,694) (552)
----------------- -----------------
Cash flows from investing activities:
Payment for purchase of oil & gas
leases - (10,850)
Payment for purchase of property,
plant and equipment (44,002) (77,956)
Payment for purchase of intangible
assets (2,231) (2,812)
Movement in restricted cash 64,112 -
Interest received 692 59
----------------- -----------------
Net cash generated (used) in investing
activities 18,571 (91,559)
----------------- -----------------
Cash flows from financing activities:
Transaction cost due to senior secured
notes issuance - (1,197)
Interest paid due to senior secured (64,453)
notes -
Notes issuance- escrow account- related
party transfer - 10,384
Drawdown of borrowings - 118,000
Repayment of loan from related parties - (16,000)
Finance cost paid (384) (21,810)
Finance costs paid for deferred license
payments - (3,494)
Repayment of obligations under leases (248) (82)
----------------- -----------------
Net cash generated (used) from financing
activities (65,085) 85,801
----------------- -----------------
Net decrease in cash and cash equivalents (48,208) (6,310)
Cash and cash equivalents at the beginning
of the period 349,827 37,421
Effect of exchange rate fluctuations
on cash held (45) (186)
----------------- -----------------
Cash and cash equivalents at the end
of the period 301,574 30,925
================= =================
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
ENERGEAN ISRAEL LIMITED
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands US Dollars, unless otherwise stated)
NOTE 1: GENERAL
A. Energean Israel Limited (the "Company") was incorporated in Cyprus on 22 July 2014 as a private company with limited liability under the Companies Law, Cap. 113. Its registered office is at Lefkonos 22, 1(st) Floor, 2064, Nicosia, Cyprus.
B. The Company and its subsidiaries (the "Group") has been established with the objective of exploration, production and commercialisation of natural gas and crude oil. The Group's main activities are performed in Israel by the Company's Israeli Branch.
C. The Group's core assets as of 31 March 2022 are comprised of: Country Asset Working interest Field phase --------- ---------------------------------- ----------------- ------------ Israel Karish (including Karish North) 100% Development Israel Tanin 100% Development Israel Blocks 12, 21, 23, 31 100% Exploration Israel Four licenses Zone D (1) 80% Exploration
(1) The Company holds 80% interests in four licenses, blocks 55, 56, 61 and 62 (together, "Zone D") in Israel's Exclusive Economic Zone ("EEZ").
D. COVID-19: Despite COVID-related challenges experienced during the period (mainly at the Admiralty Yard in Singapore, where the Karish FPSO was built), the Group has made solid progress on its flagship Karish project, offshore Israel. The FPSO sailed away from Singapore and has arrived on location in Israel at June 5, 2022. The Company expects approximately three - four months of commissioning before first gas, which expected at Q3 this year.
NOTE 2: ACCOUNTING POLICIES AND BASIS OF PREPARATION
These unaudited interim condensed consolidated financial statements for the three months ended 31 March 2022, have been prepared in accordance with the International Financial Reporting Standards ("IFRS") as adopted by the European Union (EU). The unaudited interim condensed consolidated financial statements do not include all the information and disclosures that are required for the annual financial statements and must be read in conjunction with the Group's annual consolidated financial statements for the year ended 31 December 2021.
These unaudited interim financial statements have been prepared on a going concern basis.
ENERGEAN ISRAEL LIMITED
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands US Dollars, unless otherwise stated)
NOTE 3: FINANCIAL POSITION
A. Property, Plant and Equipment:
1) Composition:
Petroleum Furniture,
and Gas Leased fixtures
assets assets and equipment Total
---------- ------- -------------- ---------
Cost:
At 1 January 2021 1,812,758 604 635 1,813,997
Additions (*) 243,346 3,405 194 246,945
Disposals (23) - - (23)
Capitalised borrowing cost
(**) 188,889 - - 188,889
Capitalised depreciation 362 - - 362
Change in decommissioning
provision (3,549) - - (3,549)
---------- ------- -------------- ---------
Total cost at 31 December
2021 2,241,783 4,009 829 2,246,621
Additions (*) 52,268 108 1,717 54,093
Disposals (900) - - (900)
Capitalised borrowing cost
(**) 35,284 - - 35,284
Capitalised depreciation 177 - - 177
---------- ------- -------------- ---------
Total cost at 31 March 2022 2,328,612 4,117 2,546 2,335,275
---------- ------- -------------- ---------
Depreciation:
At 1 January 2021 - 331 143 474
Charge for the year (Note
14) - - 85 85
Capitalised to petroleum
and gas assets - 362 - 362
Write down of the assets 433 - - 433
---------- ------- -------------- ---------
Total Depreciation at 31
December 2021 433 693 228 1,354
Expensed for the period - - 38 38
Capitalised to petroleum
and gas assets - 177 - 177
---------- ------- -------------- ---------
Total Depreciation at 31
March 2022 433 870 266 1,569
---------- ------- -------------- ---------
Net property, plant and
equipment at 31 December
2021 2,241,350 3,316 601 2,245,267
========== ======= ============== =========
Net property, plant and
equipment at 31 March 2022 2, 328,179 3,247 2,280 2,333,706
========== ======= ============== =========
(*) The additions to Petroleum and Gas assets are mainly due to the development costs of
Karish field which mainly relate to the EPCIC contract (FPSO, Sub Sea and On-shore construction
cost).
(**) The borrowing costs capitalised are mainly due to the secured senior notes.
ENERGEAN ISRAEL LIMITED
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands US Dollars, unless otherwise stated)
NOTE 3: FINANCIAL POSITION (Cont.)
2) Cash flow statement reconciliations:
For the period For the period
of three of three
months ended months ended
31 March 31 March
2022 2021
---------------- --------------
Unaudited Unaudited
---------------- --------------
Additions to property, plant and equipment 88,65 4 130,036
Less
Capitalised borrowing costs (35,284) (45,278)
Right-of-use asset additions (107) (22)
Capitalised share-based payment charge (40) (24)
Capitalised depreciation (177) (53)
---------------- --------------
Total 53,04 6 84,659
Movement in working capital (9,044) 4,147
---------------- --------------
Cash capital expenditures per the cash
flow statement (*) 44,002 88,806
---------------- --------------
(*) The amount includes payment of US$10.85 million which has been paid in 2021 to the
sellers of Karish and Tanin leases.
B. Intangible Assets:
1) Composition:
Exploration
and evaluation Software
assets license Total
--------------- -------- ------
Cost:
At 1 January 2021 13,799 255 14,054
Additions 6,342 - 6,342
--------------- -------- ------
At 31 December 2021 20,141 255 20,396
--------------- -------- ------
Additions 5,173 - 5,173
--------------- -------- ------
At 31 March 2022 25,314 255 25,569
--------------- -------- ------
Amortisation:
At 1 January 2021 - 247 247
Charge for the year - 8 8
--------------- -------- ------
Total Amortisation at 31 December
2021 - 255 255
--------------- -------- ------
Expensed for the period - - -
--------------- -------- ------
Total Amortisation at 31 March
2022 - 255 255
--------------- -------- ------
Net intangible assets at 31
December 2021 20,141 - 20,141
=============== ======== ======
Net intangible assets at 31
March 2022 25,314 - 25,314
=============== ======== ======
ENERGEAN ISRAEL LIMITED
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands US Dollars, unless otherwise stated)
NOTE 3: FINANCIAL POSITION (Cont.)
2) Cash flow statement reconciliations:
For the period
of three For the period
months ended of nine months
31 March ended 31
2022 March 2021
-------------- ---------------
Unaudited Unaudited
-------------- ---------------
Additions to intangible assets 5,173 2,799
Less
Movement in working capital (2,942) 13
-------------- ---------------
Cash capital expenditures per the
cash flow statement 2,231 2,812
============== ===============
C. Senior secured Notes:
1) Issuance of US$2,500,000,000 senior secured notes:
On 24 March 2021 ("Issue Date"), Energean Israel Finance Ltd (a subsidiary of the Company, held 100%) announced on closing of an offering of US$2,500,000,000 senior secured notes.
The Notes were issued in four series as follows:
31 31 December
March 2021
2022
--------------- ---------------
Series Maturity Annual fixed
Interest
rate Carrying value Carrying value
------------------ --------------- ------------- --------------- ---------------
US$ 625 million 30 March 2024 4.500% 617,942 617,060
US$ 625 million 30 March 2026 4.875% 616,498 615,966
US$ 625 million 30 March 2028 5.375% 615,842 615,451
US$ 625 million 30 March 2031 5.875% 615,337 615,047
------------------ --------------- ---------------
US$2,500 million 2,465,619 2,463,524
=================================== =============== ===============
The interest on each series of the Notes will be paid semi-annually, on 30 March and on 30 September of each year.
The Notes are listed for trading on the TACT Institutional of the Tel Aviv Stock Exchange Ltd. (the "TASE").
With regards to the Indenture document, signed on 24 March 2021 with HSBC BANK USA, N.A (the "Trustee"), no Indenture default or Indenture event of default has occurred and is continuing.
ENERGEAN ISRAEL LIMITED
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands US Dollars, unless otherwise stated)
NOTE 3: FINANCIAL POSITION (Cont.) 2) Restricted cash:
As of 31 March 2022 the restricted cash of the Company includes:
o Long term restricted cash of US$100 million Debt Payment Fund that would be released upon achieving three quarters annualized production of 3.8 BCM/year.
o Short term restricted cash of US$35.6 million to cover the Interest Reserve Account for the accrued interest of the senior Secured Notes till 30 June 2022.
3) Credit rating:
Moody's assigns Ba3 rating the senior secured notes, and S&P Global assigns BB- rating the senior secured notes.
D. Fair value measurements:
The information set out below provides information about how the Group determines the fair values of various financial assets and liabilities.
The fair values of the Group's non-current liabilities measured at amortised cost are considered to approximate their carrying amounts at the reporting date.
The carrying value less any estimated credit adjustments for financial assets and financial liabilities with a maturity of less than one year are assumed to approximate their fair values due to their short term-nature.
The fair value hierarchy of financial assets and financial liabilities that are not measured at fair value (but fair value disclosure is required) is as follows:
Fair value hierarchy as of 31 March 2022
-----------------------------------------------
Unaudited
-----------------------------------------------
Level 1 Level 2 Level 3 Total
---------- ----------- --------- -----------
Financial assets
Long term trade and other
receivables - 9,184 - 9,184
Loan to related party - 346,000 - 346,000
Long term restricted cash 100,000 - - 100,000
Short term restricted cash 35,617 - - 35,617
Short term trade and other
receivables - 29,076 - 29,076
Cash and cash equivalents 301,574 - - 301,574
---------- ----------- --------- -----------
Total 437,191 384,260 - 821,451
---------- ----------- --------- -----------
Financial liabilities
Senior secured notes - 2,465,619 - 2,465,619
Trade and other payables
- long term - 54,234 - 54,234
Trade and other payables
- short term - 69,949 - 69,949
---------- ----------- --------- -----------
Total - 2,589,802 - 2,589,802
---------- ----------- --------- -----------
ENERGEAN ISRAEL LIMITED
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands US Dollars, unless otherwise stated)
NOTE 3: FINANCIAL POSITION (Cont.)
Fair value hierarchy as of 31 December
2021
--------------------------------------------
Audited
--------------------------------------------
Level 1 Level 2 Level 3 Total
--------- ----------- -------- ----------
Financial assets
Long term trade and other
receivables 6,402 - 6,402
Loan to related party 346,000 - 346,000
Long term restricted cash 100,000 - 100,000
Short term restricted cash 99,729 - 99,729
Short term trade and other
receivables - 22,176 - 22,176
Cash and cash equivalents 349,827 - - 349,827
--------- ----------- -------- ----------
Total 549,556 374,578 - 924,134
--------- ----------- -------- ----------
Financial liabilities
Senior secured notes - 2,495,751 - 2,495,751
Trade and other payables
- long term - 59,727 - 59,727
Trade and other payables
- short term - 40,312 - 40,312
--------- ----------- -------- ----------
Total - 2,595,790 - 2,595,790
----------- -------- ----------
E. Trade and other payables:
31 March 31 December
2022 2021
--------- -----------
Unaudited Audited
--------- -----------
Current
Financial items
Trade accounts payable (1) 27,649 32,611
Accrued expenses (1) 11,036 5,611
Payables to related parties 5,538 1,079
Deferred license payments (2) 24,695 -
Interest payable - 32,227
Current lease liabilities 1,031 1,011
--------- -----------
69,949 72,539
Non-Financial items
VAT payable - 1,217
Social insurance and other taxes 192 132
Income taxes 17 227
--------- -----------
209 1,576
70,158 74,115
========= ===========
ENERGEAN ISRAEL LIMITED
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands US Dollars, unless otherwise stated)
NOTE 3: FINANCIAL POSITION (Cont.)
31 March 31 December
2022 2021
--------- -----------
Unaudited Audited
--------- -----------
Non-current
Financial items
Accrued expenses to related parties 152 294
Long term lease liabilities 2,134 2,203
Trade and other payables (4) 18,171 -
Deferred license payments (2) 33,777 57,230
--------- -----------
54,234 59,727
Non-Financial items
Sales consideration received in advance
(INGL) (3) - 53,537
--------- -----------
- 53,537
54,234 113,264
========= ===========
(1) The change in Trade payables and accrued expenses represents mainly timing differences and levels of work activity in Karish project. Trade payables are non-interest bearing.
(2) In December 2016, the Company acquired the Karish and Tanin offshore gas fields for US$40 million closing payment with an obligation to pay additional consideration of US$108.5 million plus interest inflated at an annual rate of 4.6% in ten equal annual payments. As at 31 March 2022 the total discounted deferred consideration was approx. US$58 million (as at 31 December 2021: approx. US$57million).
The Sale and Purchase Agreement ("SPA") includes provisions in the event of Force Majeure that prevents or delays the implementation of the development plan as approved under one lease for a period of more than ninety (90) days in any year following the final investment decision ("FID") date. In the event of Force Majeure, the applicable annual payment of the remaining consideration will be postponed by an equivalent period of time, and no interest will be accrued in that period of time as well.
Due to the effects of the COVID-19 pandemic which constitute a Force Majeure event, the deferred payment due in March 2022 was postponed.
(3) The sales consideration received in advance is related to the agreement with Israel Natural Gas Lines ("INGL") for the transfer of title (the "hand over") of the near shore and onshore part of the infrastructure that will deliver gas from the Energean Power FPSO into the Israeli national gas transmission grid. It is intended that the hand over to INGL will become effective at least 90 days after the delivery of first gas from the Karish field which expected in Q3-2022. Following Hand Over, INGL will be responsible for the operation and maintenance of this part of the infrastructure.
As of 31 March 2022, the sales consideration received in advance presented as short term liability (on 31 December 2021 was presented under long term payables).
(4) In March 2022 the company signed the amendment to EPCIC contract to delay part of the payments according to agreed schedule.
ENERGEAN ISRAEL LIMITED
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands US Dollars, unless otherwise stated)
NOTE 4: COMPREHENSIVE INCOME
For the period
of three For the period
months ended of three months
31 March ended 31 March
2022 2021
-------------- ------------------
Unaudited Unaudited
-------------- ----------------
General & administration expenses
Payroll costs 397 384
Share-based payment charge included in
administrative expenses 31 21
Depreciation and amortisation (Notes 3(A)
and 3(B)) 38 29
Auditor fees 80 98
Other general & administration expenses 1,659 346
-------------- ----------------
Total administrative expenses 2,20 5 878
Other expenses
Loss from property, plant and equipment
disposal 824 23
-------------- ----------------
Total other expenses 824 23
-------------- ----------------
Other income
Gain from disposal (53) -
-------------- ----------------
Total other income (53) -
-------------- ----------------
A. Operating loss:
ENERGEAN ISRAEL LIMITED
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands US Dollars, unless otherwise stated)
NOTE 4: COMPREHENSIVE INCOME (Cont.)
B. Net finance income (expenses):
For the For the
period of period of
three months three months
ended 31 ended 31
March 2022 March 2021
------------- ---------------
Unaudited Unaudited
------------- -------------
Interest on bank borrowings - 27,213
Interest on senior secured notes (1) 34,323 2,507
Interest expense on long terms payables 2,064 1,913
Interest on shareholders loan - 9
Less amounts included in the cost of
qualifying assets (2) (33,744) (31,642)
------------- -------------
2,643 -
Finance and arrangement fees 1,459 11,374
Other finance costs and bank charges 264 19
Interest expenses from Hedging - 2,249
Unwinding of discount on decommissioning
liabilities 171 138
Interest on obligations for leases 83 13
Less amounts included in the cost of
qualifying assets (2) (1,542) (13,636)
------------- -------------
435 157
Total finance costs 3,078 157
Interest income from time deposits 557 23
Interest income from loans to related
parties 2,781 -
-------------
Total finance income 3,338 23
Net foreign exchange gain (loss) (68) 517
Net finance income 192 383
------------- -------------
(1) See also Note 3(C)(1).
(2) See also Note 3(A).
NOTE 5: TAXATION
A. Tax income:
For the For the
period of period of
three months three months
ended 31 ended 31
March 2022 March 2021
------------- ---------------
Unaudited Unaudited
Corporation tax - current year (67) -
Deferred tax income 1,327 173
------------- -------------
Total taxation income 1,260 173
============= =============
ENERGEAN ISRAEL LIMITED
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands US Dollars, unless otherwise stated)
NOTE 5: TAXATION (Cont.) B. Deferred tax:
The deferred taxes, driven from the activity in Israel by the Israeli Branch of the Company, are computed at the average tax rate of 23%, based on the tax rates that are expected to apply upon reversal. The deferred taxes are presented in the statement of financial position as non-current assets. Below are the items for which deferred taxes were recognised:
Accrued
Property, expenses
plant Right and other
and of short--term
equipment use liabilities
& asset Deferred Staff and other Provisions
intangible IFRS Tax expenses leaving long--term Derivative for
asset 16 losses for tax indemnities liabilities liability decommissioning Total
---------- ----- ------- -------- ----------- ----------- ---------- --------------- -------
At 1 January 2021 (12,140) (62) 9,325 - 63 293 1,591 8,769 7,839
Increase
(decrease) for
the year through:
Profit or loss (492) (700) 1,436 5,020 31 630 - (598) 5,327
Reclassification
for the
current year - - (1,090) 1,090 - - - - -
Other
comprehensive
income - - - - - - (1,591) - (1,591)
---------- ----- ------- -------- ----------- ----------- ---------- --------------- -------
At 31 December
2021 (12,632) (762) 9,671 6,110 94 923 - 8,171 11,575
========== ===== ======= ======== =========== =========== ========== =============== =======
Increase
(decrease) for
the period
through :
Profit or loss (1,285) (11) 2,568 - - 16 - 39 1,327
---------- ----- ------- -------- ----------- ----------- ---------- --------------- -------
At 31 March 2022 (13,917) (773) 12,239 6,110 94 939 - 8,210 12,902
========== ===== ======= ======== =========== =========== ========== =============== =======
ENERGEAN ISRAEL LIMITED
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands US Dollars, unless otherwise stated)
NOTE 6: SIGNIFICANTS EVENTS AND TRANSACTIONS DURING THE REPORTING PERIOD
A. Gas supply agreement with the Israel Electric Company
In March 2022, Energean signed a gas supply agreement with the Israel Electric Company.
The gas price will be determined in each period, with volumes determined on a daily basis.
Starting upon the commencement of first gas production from Karish, the agreement will
be valid for an initial one-year period with an option to extend subject to ratification by
both parties
B. Offshore Israel during March 2022:
The company started the drilling of three wells during March 2022. See also Note 7(D).
NOTE 7: SIGNIFICANTS EVENTS AND TRANSACTIONS AFTER THE REPORTING PERIOD A. Share Premium Capital reduction:
On 8 April 2022 the Company reduced its share premium capital at the amount of 360 million USD and credited against it the loan to its shareholder at the amount of $US346 million and the accrued interest to receive as of 8 April 2022.
B. Termination of contract with Gas Buyer
In May 2022, further to the claims raised by the parties in the related arbitration proceedings (including the counterclaim filed by Energean seeking a declaration that Energean is entitled to terminate the GSPA as well as damages), Dalia and the Company agreed to end all claims and disputes between them. Both sides agreed that the Dalia GSPA (which represents up to 0.8 billion cubic meter ("bcm") per year was lawfully terminated, that the arbitration proceedings are terminated, and that neither party owes or will be liable to the other for any payment in connection with and due to the Dalia GSPA, the arbitration proceedings and the facts subject thereof. This was agreed to be final and unappealable.
C. Contract signed with new Gas Buyer
In May 2022 Company has signed a new GSPA, representing up to 0.8 bcm/year , to supply gas to the East Hagit Power Plant Limited Partnership ("EH Partnership"), a partnership between the Edeltech Group and Shikun & Binui Energy.
The GSPA is for a term of approximately 15 years, for a total contract quantity of up to 12 bcm. The contract contains provisions regarding floor pricing, offtake exclusivity and a price indexation mechanism.
D. Athena Gas Discovery
Commercial discovery made by the Athena exploration well, Block 12, in the A, B and C sands. Preliminary analysis indicates that the Athena discovery contains recoverable gas volumes of 8 bcm on a standalone basis.
This discovery is particularly significant as it de-risks an additional 50 bcm of mean unrisked prospective resources across Energean's Olympus Area (total 58 bcm including Athena). The Olympus Area is Energean's newly defined area which includes Athena, plus the undrilled prospects on Block 12 and the adjacent Tanin Lease.
ENERGEAN ISRAEL LIMITED
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands US Dollars, unless otherwise stated)
NOTE 7: SIGNIFICANTS EVENTS AND TRANSACTIONS AFTER THE REPORTING PERIOD (Cont.) E. Claim submitted under the Karish-Tanin SPA
On 31 May 2022, NewMed Energy LP (previously named Delek Drilling LP) ("NewMed") filed a lawsuit against the Company before the Tel Aviv District Court. The claim is for the amount of US$65.1 million plus interest and indexation, constituting the outstanding consideration under the SPA (see Note 3(E)(2)). The residual remedy requested is US$10.85 million plus interest and indexation, reflecting the annual payment for the year 2021. The claim is purportedly based on a payment acceleration mechanism set in the SPA, combined with NewMed's rejection of the Company's Force Majeure claim. The claim is being assessed by the Company together with its legal advisors.
F. The FPSO sailed away from Singapore and has arrived on location in Israel on 5 June 2022.
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(END) Dow Jones Newswires
June 07, 2022 02:00 ET (06:00 GMT)
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