As the war in Gaza rages on and tensions rise between Israel and Hezbollah in Lebanon, private equity fund Carlyle (NASDAQ:CG) is launching a new Mediterranean oil and gas company led by former BP CEO Tony Hayward. The fund previously acquired nearly $1 billion worth of Energean assets in three countries.
The transaction, which is subject to regulatory approval, will give Carlyle “a diversified portfolio of strategic gas-focused assets with expected production of 47,000 barrels of oil per day and operations in Italy, Egypt and Croatia, as well as advanced, large-scale developments in markets that support the development of new gas fields,” the fund said in a press release on Thursday.
The portfolio also includes shares in Cassiopea, Italy’s largest gas field in terms of reserves, and in Abu Qir, one of Egypt’s largest gas production centers.
Overall, Carlyle sees the deal as an opportunity to invest more in alternatives to Russian gas for Europe.
Currently, Energean produces gas mainly off the coast of Israel. CEO Mathios Rigas told Reuters on Thursday that the company was looking to expand in Europe, the Middle East and Africa. “This is a great deal for us. We are selling assets at three times the price we bought them for,” he told Reuters in reference to Thursday’s announcement.
Shares of Carlyle Group Inc. were up more than 1% at the time of writing on Thursday, while shares of London-listed Energean were up well over 3%.
The transaction is expected to close at the end of this year.
Energean operates the Karish offshore gas field in the Mediterranean Sea, in sea waters that are the subject of a long-standing territorial dispute between Israel and Lebanon. Although Karish is primarily a gas field, Energean exported its first crude from the field in February last year, catapulting itself into the oil exporters’ club. Gas production began in February this year, and observers warn that the field could become a target of Hezbollah as cross-border rocket attacks and airstrikes have increased in recent weeks.
By Charles Kennedy for Oilprice.com
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