REG - Energean PLC - Energean Israel Half Year 2023 Accounts
07/09/2023 07:15
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RNS Number : 6354L Energean PLC 07 September 2023
ENERGEAN ISRAEL LIMITED
UNAUDITED INTERIM CONDENCED CONSOLIDATED FINANCIAL STATEMENTS
30 JUNE 2023
ENERGEAN ISRAEL LIMITED
UNAUDITED INTERIM CONDENCED CONSOLIDATED FINANCIAL STATEMENTS
AS OF 30 JUNE 2023
INDEX
Page
Interim Condensed Consolidated Statement of Comprehensive Income 3
Interim Condensed Consolidated Statement of Financial Position 4
Interim Condensed Consolidated Statement of Changes in Equity 5
Interim Condensed Consolidated Statement of Cash Flows 6
Notes to the Interim Condensed Consolidated Financial Statements 7-20
- - - - - - - - - - - - - - - - - - - -
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
SIX MONTHS ENDED 30 JUNE 2023
30 June (Unaudited)
Notes 2023 2022
$'000 $'000
Revenue 3 347,743 -
Cost of sales 4 (178,077) -
Gross profit 169,666 -
Administrative expenses 4 (9,048) (5,453)
Exploration and evaluation expenses 4 (50) -
Other expenses 4 - (1,074)
Other income 4 - 53
Operating profit/(loss) 160,568 (6,474)
Financial income 5 1,044 4,504
Financial expenses 5 (67,569) (4,671)
Foreign exchange loss, net 5 (5,578) (967)
Profit/(loss) for the period before tax 88,465 (7,608)
Taxation (expense)/income 6 (20,215) 2,703
Net profit (loss) for the period 68,250 (4,905)
The accompanying notes are an integral part of the interim condensed
consolidated financial statements.
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
AS OF 30 JUNE 2023
Notes 30 June 2023 31 December
(Unaudited) 2022
$'000 $'000
ASSETS:
NON-CURRENT ASSETS:
Property, plant and equipment 7 2,873,206 2,926,313
Intangible assets 8 156,689 143,554
Other receivables 10 8,506 108
Deferred tax asset 9 2,827 22,886
3,041,228 3,092,861
CURRENT ASSETS:
Trade and other receivables 10 97,381 82,611
Inventories 11 13,327 8,313
Restricted cash 8,481 71,778
Cash and cash equivalents 64,688 24,825
183,877 187,527
TOTAL ASSETS 3,225,105 3,280,388
EQUITY AND LIABILITIES:
EQUITY:
Share capital 1,708 1,708
Share premium 212,539 212,539
Retained losses (2,278) (70,528)
TOTAL EQUITY 211,969 143,719
NON-CURRENT LIABILITIES:
Senior secured notes 12 1,852,685 2,471,030
Decommissioning provisions 87,400 84,299
Trade and other payables 13 205,870 210,241
2,145,955 2,765,570
CURRENT LIABILITIES:
Current portion of senior secured notes 12 622,225 -
Trade and other payables 13 244,956 371,099
867,181 371,099
TOTAL LIABILITIES 3,013,136 3,136,669
TOTAL EQUITY AND LIABILITIES 3,225,105 3,280,388
06 September 2023
Panagiotis Benos Matthaios Rigas
Director Director
The accompanying notes are an integral part of the interim condensed
consolidated financial statements.
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
SIX MONTHS ENDED 30 JUNE 2023
Share capital Share Premium Accumulated losses Total equity
$'000 $'000 $'000 $'000
Balance as of 1 January 2023 1,708 212,539 (70,528) 143,719
Profit for the period - - 68,250 68,250
Balance as of 30 June 2023 (unaudited) 1,708 212,539 (2,278) 211,969
Balance as of 1 January 2022 1,708 572,539 (35,946) 538,301
Transactions with shareholders
Share premium reduction (*) - (360,000) - (360,000)
Comprehensive loss
Loss for the period - - (4,905) (4,905)
Balance as of 30 June 2022 (unaudited) 1,708 212,539 (40,851) 173,396
(*) In April 2022 the Company reduced its share premium capital by US$360
million and credited US$346 million against the shareholder loan account plus
accrued interest.
The accompanying notes are an integral part of the interim condensed
consolidated financial statements.
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS PERIOD ENDED 30 JUNE 2023
30 June (Unaudited)
Notes 2023 2022
$'000 $'000
Operating activities
Profit (Loss) for the period before tax 88,465 (7,608)
Adjustments to reconcile loss before taxation to net cash provided by
operating activities:
Depreciation, depletion and amortisation ( ) 4 74,375 110
Loss from sale on property, plant and equipment ( ) 4 - 1,074
Amortisation of payment made in advance to customers ( ) 3 4,928 -
Finance Income ( ) 5 (1,044) (4,504)
Finance expenses ( ) 5 67,569 4,673
Net foreign exchange loss ( ) 5 5,578 967
Cash flow from operations before working capital 239,871 (5,288)
(Increase)/decrease in trade and other receivables (36,564) 871
Increase in inventories (5,014) -
Decrease in trade and other payables (25,707) (310)
Cash from operations 172,586 (4,727)
Income taxes paid (368) (558)
Net cash inflows from/(used in) operating activities 172,218 (5,285)
819
Investing activities
Payment for exploration and evaluation, and other intangible assets 8(B) (69,227) (10,034)
Payment for purchase of property, plant and equipment 7(C) (115,511) (130,118)
Proceeds from disposals of property, plant and equipment - 188
Amounts received from INGL related to transfer of property, plant and 10 56,906 17,371
equipment
Movement in restricted cash, net 63,297 64,119
Interest received 1,841 1,544
Net cash outflows used in investing activities (62,694) (56,930)
Financing activities
Senior secured notes - interest paid 12 (64,453) (64,453)
Other finance cost paid (91) (1,869)
Finance costs paid for deferred licence payments (2,496) -
Transaction cost related to Senior Secured Notes 16 (1,214) -
Repayment of obligations under leases 13 (570) (499)
Net cash outflow used in financing activities (68,824) (66,821)
Net increase/(decrease) in cash and cash equivalents 40,700 (129,036)
Cash and cash equivalents at beginning of the period 24,825 349,827
Effect of exchange differences on cash and cash equivalents (837) (2,080)
Cash and cash equivalents at end of the period 64,688 218,711
The accompanying notes are an integral part of the interim condensed
consolidated financial statements.
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,
Strovolos, 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 its
Israeli Branch.
c. As of 30 June 2023, the Company had investments in the following
subsidiaries:
Name of subsidiary Country of incorporation / registered office Principal activities Shareholding Shareholding
At 30 June
At 31 December 2022
(%)
2023
(%)
Energean Israel Transmission LTD 121, Menachem Begin St. Gas transportation license holder 100 100
Azrieli Sarona Tower, POB 24,
Tel Aviv 67012039 Israel
Energean Israel Finance LTD 121, Menachem Begin St. Financing activities 100 100
Azrieli Sarona Tower, POB 24,
Tel Aviv 67012039 Israel
d. The Group's core assets as of 30 June 2023 are comprised of:
Country Asset Field Working interest Field phase
Israel Karish Karish Main 100% Production
Israel Karish Karish North 100% Development
Israel Tanin Tanin 100% Development
Israel Blocks 12, 21, 23, 31 Athena, Zeus, Hera, Hermes and Hercules 100% Exploration
NOTE 2: - Accounting policies and basis of preparation
These unaudited interim condensed consolidated financial statements for the
six months ended 30 June 2023, 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 2022.
These unaudited interim financial statements have been prepared on a going
concern basis.
NOTE 3: - Revenues
30 June (Unaudited)
2023 2022
$'000 $'000
Revenue from gas sales ((1)) 271,399 -
Revenue from Hydrocarbon liquids sales ((3)) 81,272 -
Compensation to customers ((2)) (4,928) -
Total revenue 347,743 -
((1)) Sales gas for six months ended 30 June 2023 totaled approximately 1.8
bcm (the Company started production on 26 October 2022).
((2)) During 2021 and in accordance with the GSPAs signed with a group of gas
buyers, the Company paid compensation to these counterparties following delays
to the supply of gas from the Karish project. The compensation is deducted
from revenue, as variable consideration, as the gas is delivered to the gas
buyers, in accordance with IFRS 15 Revenue Recognition
((3)) Sales Hydrocarbon liquids for six months ended 30 June 2023 totaled
approximately 1.16 mmbbl (the Company did not sell Hydrocarbon liquids during
2022).
NOTE 4: - Operating profit (loss) before taxation
30 June (Unaudited)
2023 2022
$'000 $'000
(a) Cost of sales
Staff costs 4,071 -
Energy cost 2,285 -
Royalty payable 63,474 -
Depreciation and amortisation (Note 7) 73,397 -
Other operating costs 38,203 -
Liquids inventory movement (Note 11) (3,353) -
Total cost of sales 178,077 -
(b) General & administration expenses (c) (d)
Staff costs 1,715 935
Share-based payment charge 312 80
Depreciation and amortisation (Note 7, 8) 978 110
Auditor fees 106 88
Other general & administration expenses 5,937 4,240
Total administrative expenses 9,048 5,453
(c) Exploration and evaluation expenses
Other exploration and evaluation expenses 50 -
Total exploration and evaluation expenses 50 -
(d) Other expenses
Loss from disposal of property, plant and equipment - 1,074
Total other expenses - 1,074
(e) Other income (f) (g)
Other income - 53
Total other income - 53
NOTE 5: - Net finance income/(expenses)
30 June (Unaudited)
2023 2022
$'000 $'000
Interest on senior secured notes (1) 68,333 68,179
Interest expense on long terms payables (3) 1,554 4,731
Less amounts included in the cost of qualifying assets (2) (7,592) (68,866)
62,295 4,044
Finance and arrangement fees 1,481 2,842
Other finance costs and bank charges 55 284
Unwinding of discount on trade payable 2,060 264
Unwinding of discount on provision for decommissioning 1,668 343
Unwinding of discount on right of use asset 98 160
(1)
Less amounts included in the cost of qualifying assets (2) (88) (3,266)
5,274 627
Total finance costs 67,569 4,671
Interest income from time deposits (1,044) (1,290)
Interest income from loans to related parties - (3,214)
Total finance income (1,044) (4,504)
Net foreign exchange losses 5,578 967
Net finance expense 72,103 1,134
(1) See also Note 12.
(2) See also Note 7(A).
(3) See also Note 13.
NOTE 6: - Taxation
1. Taxation charge:
30 June (Unaudited)
2023 2022
$'000 $'000
Tax - current period (156) (180)
Deferred tax (20,059) 2,883
Total taxation income (expense) yyyyyuuuu( (20,215) 2,703
NOTE 7: - Property, Plant and Equipment
a. Composition:
Oil and gas Assets Leased assets Furniture, fixtures and equipment Total
$'000 $'000 $'000 $'000
Cost:
At 1 January 2022 2,241,783 4,009 829 2,246,621
Additions ((1)) 514,373 731 1,165 516,269
Disposals (900) - - (900)
Capitalised borrowing cost ((2)) 129,357 - - 129,357
Capitalised depreciation 632 - - 632
Change in decommissioning provision 47,544 - - 47,544
Total cost at 31 December 2022 2,932,789 4,740 1,994 2,939,523
Additions ((1)) 111,124 12,197 111 123,432
Handover to INGL((4)) (111,448) - - (111,448)
Capitalised borrowing cost ((2)) 7,680 - - 7,680
Change in decommissioning provision 1,433 - - 1,433
Total cost at 30 June 2023 (unaudited) 2,941,578 16,937 2,105 2,960,620
Depreciation:
At 1 January 2022 433 693 228 1,354
Charge for the year ((3)) 10,976 134 297 11,407
Capitalised to oil and gas assets - 632 - 632
Disposals (433) - - (433)
Write down of the assets 250 - - 250
Total Depreciation at 31 December 2022 11,226 1,459 525 13,210
Charge for the period 73,397 618 189 74,204
Total Depreciation at 30 June 2023 (unaudited) 84,623 2,077 714 87,414
At 31 December 2022 2,921,563 3,281 1,469 2,926,313
At 30 June 2023 (unaudited) 2,856,955 14,860 1,391 2,873,206
((1)) The additions to oil & gas assets in 2023 are primarily due to
development costs for the FPSO, Karish North and 2(nd) Oil Train. The
additions in 2022 are primarily due to development costs for the Karish field,
incurred under the EPCIC contract, FPSO, subsea and onshore construction.
((2)) Capitalised borrowing costs relate primarily to the secured senior
notes.
((3)) First production from the Karish project was achieved on 26 October
2022.
((4)) Handover to INGL took place on 22 March 2023.
NOTE 7: - Property, Plant and Equipment (Cont.)
b. Depreciation expense for the period has been recognised as
follows:
30 June (Unaudited)
2023 2022
$'000 $'000
Cost of sales 73,397 -
Administration expenses 807 110
Capitalised depreciation in oil & gas assets - 357
Total 74,204 467
c. Cash flow statement reconciliations:
30 June (Unaudited)
2023 2022
$'000 $'000
Additions and disposals to property, plant and equipment, net 21,097 339,911
Associated cash flows
Payment for additions to property, plant and equipment , net (58,605) (130,118)
Non-cash movements/presented in other cash flow lines
Capitalised borrowing costs (7,680) (60,749)
Right-of-use asset additions (12,197) (198)
Handover to INGL 111,448 -
Capitalised share-based payment charge - (109)
Capitalised depreciation - (357)
Change in decommissioning provision (1,433) 9,259
Movement in working capital (52,630) (157,639
+)
NOTE 8: - Intangible Assets
a. Composition:
Exploration and evaluation assets Software licences Total
$'000 $'000 $'000
Cost:
At 1 January 2022 20,141 255 20,396
Additions ((1)) 123,005 1,713 124,718
Write off of exploration and evaluation costs ((2)) (1,277) - (1,277)
At 31 December 2022 141,869 1,968 143,837
Additions ((1)) 13,306 - 13,306
At 30 June 2023 (unaudited) 155,175 1,968 155,173
Amortisation:
At 1 January 2022 - 255 255
Charge for the year - 28 28
Total Amortisation at 31 December 2022 - 283 283
Charge for the period - 171 171
Total Amortisation at 30 June 2023 (unaudited) - 454 454
At 31 December 2022 141,869 1,685 143,554
At 30 June 2023 (unaudited) 155,175 1,514 156,689
((1)) Additions to exploration and evaluation assets are primarily due to the
2022 growth drilling programme undertaken offshore Israel.
((2)) Zone D: On 27 July 2022, the Company sent a formal notice to the
Ministry of Energy notifying the relinquishment of Zone D and discontinuation
of related work. As such, the licences subsequently expired on 27 October
2022.
b. Cash flow statement reconciliations:
30 June (Unaudited)
2023 2022
$'000 $'000
Additions to intangible assets 13,306 34,386
Associated cash flows
Payment for additions to intangible assets (69,227) (10,034)
Non-cash movements/presented in other cash flow lines
Movement in working capital 55,921 24,352
NOTE 9: - Deferred taxes
The Group is subject to corporation tax on its taxable profits in Israel at
the rate of 23%. The capital gain tax rates depend on the purchase date and
the nature of the asset. The general capital gains tax rate for a corporation
is the standard corporate tax rate.
Tax losses can be utilised for an unlimited period, and tax losses may not be
carried back.
According to Income Tax (Deductions from Income of Oil Rights Holders)
Regulations, 5716-1956, the exploration and evaluation expenses of oil and gas
assets are deductible in the year in which they are incurred.
The Group expects that there will be sufficient taxable profits in the
following years and that deferred tax assets, recognised in the interim
condensed consolidated financial statements of the Group, will be recovered.
NOTE 9: - Deferred taxes (Cont.)
Below are the items for which deferred taxes were recognised:
Property, plant and equipment & intangible assets Right of use asset Tax losses Deferred expenses for tax Staff leaving indemnities Accrued expenses and other short‑term liabilities and other long‑term Decommissioning provision Total
liabilities
$'000 IFRS 16 $'000 $'000 $'000
$'000 $'000
$'000
$'000
At 1 January 2023 (40,344) (754) 56,415 6,209 167 1,193 - 22,886
Increase/(decrease) for the period through:
Profit or loss (13,597) (2,663) (6,305) (314) 50 2,770 - (20,059)
At 30 June 2023 (53,941) (3,417) 50,110 5,895 217 3,963 - 2,827
At 1 January 2022 (12,632) (762) 4,750 11,031 94 923 8,171 11,575
Increase/(decrease) for the year through:
Profit or loss (27,712) 8 51,665 (4,822) 73 270 (8,171) 11,311
At 31 December 2022 (40,344) (754) 56,415 6,209 167 1,193 - 22,886
30 June 2023 31 December
(Unaudited) 2022
$'000 $'000
Deferred tax liabilities (57,358) (41,099)
Deferred tax assets 60,185 63,985
2,827 22,886
NOTE 10: - Trade and other receivables
30 June 2023 31 December
(Unaudited) 2022
$'000 $'000
Current
Financial items
Trade receivables
Trade receivables 93,896 37,491
Other receivables ((1)) 2,294 999
Refundable VAT - 37,131
Accrued interest income 92 888
96,282 76,509
Non-financial items
Prepayments 363 159
Prepaid income tax 189 -
Deferred expenses ((2)) - 4,929
Prepaid expenses and other receivable 547 1,014
1,099 6,102
Total current trade and other receivables 97,381 82,611
Non-current
Financial items
Other receivables ((1)) 4,949 -
Non-financial items
Deferred borrowing fees((3)) 3,449 -
Deposits and prepayments 108 108
3,557 108
Total non-current trade and other receivables 8,506 108
((1)) The increase from 2022 is due to the recognition of a receivable from
INGL (US$2.3 million current (US$57 received during Q2 2023) and US$4.95
million non-current) following the handover of the asset to INGL, in line with
the agreement. See Note 13(4) for further details.
((2)) Deferred expenses relate to compensation to gas buyers following delays
to the supply of gas from the Karish project. This compensation is treated as
variable consideration under IFRS 15 Revenue Recognition and therefore,
reduced from gas sales following commencement of production, see also Note 3.
((3)) Fees incurred in relation to the $750 million senior secured note
offering. See Note 16 for further details.
NOTE 11: - Inventory
30 June 2023 31 December
(Unaudited) 2022
$'000 $'000
Hydrocarbon liquids 5,707 2,367
Natural gas 457 383
Raw materials and supplies 7,163 5,563
Total 13,327 8,313
NOTE 12: - Borrowings and secured notes
a. Issuance of US$2,500,000,000 senior secured notes:
On 24 March 2021 (the "Issue Date"), Energean Israel Finance Ltd (a 100%
subsidiary of the Company) issued US$2,500 million of senior secured notes.
The proceeds were primarily used to repay in full the project finance facility
The Notes were issued in four equal tranches as follows:
30 June 2023 31 December
(Unaudited) 2022
Series Maturity Annual fixed Interest rate Carrying value $'000 Carrying value $'000
US$ 625 million 30 March 2024 4.500% 622,225 620,461
US$ 625 million 30 March 2026 4.875% 618,918 617,912
US$ 625 million 30 March 2028 5.375% 617,447 616,767
US$ 625 million 30 March 2031 5.875% 616,320 615,890
US$2,500 million 2,474,910 2,471,030
30 June 2023 31 December
(Unaudited) 2022
$'000 $'000
Senior secured notes - current 622,225 -
Senior secured notes - non current 1,852,685 2,471,030
Total 2,474,910 2,471,030
The interest on each series of the Notes is paid semi-annually, on 30 March
and on 30 September of each year.
The Notes are listed on the TASE-UP 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.
Collateral:
The Company has provided/undertakes to provide the following collateral in
favor of the Trustee:
a. First rank fixed charges over the shares of Energean Israel
Limited, Energean Israel
Finance Ltd and Energean Israel Transmission Ltd, the Karish & Tanin
Leases, the gas sale and purchase agreements ("GSPAs"), several bank accounts,
operating permits, insurance policies, the Company's exploration licences and
the INGL Agreement.
b. Floating charge over all of the present and future assets of
Energean Israel Limited and Energean Israel Finance Ltd.
c. The Energean Power FPSO.
Subsequent to 30 June 2023, the notes maturing on 30 March 2024 were
refinanced. Please refer to note 16 for more
details
Credit rating:
The senior secured notes have been assigned a Ba3 rating by Moody's and a BB-
rating by S&P Global.
NOTE 13: - Trade and other payables
30 June 2023 31 December
(Unaudited) 2022
$'000 $'000
Current
Financial items
Trade accounts payable ((1)) 113,144 209,853
Payables to related parties 32,260 21,028
VAT payable 2,398 -
Deferred licence payments due within one year ((2)) 12,852 13,345
Other creditors 10,300 6,712
Current lease liabilities 7,868 1,792
178,822 252,730
Non-financial items
Accrued expenses ((1)) 33,182 29,404
Other finance costs accrued 32,227 32,227
Contract liability ((4)) - 56,230
Social insurance and other taxes 724 502
Income taxes - 6
66,133 118,369
Total current trade and other payables 244,956 371,099
Non-current
financial items
Trade and other payables ((3)) 169,869 169,360
Deferred licence payments ((2)) 27,698 38,488
Long term lease liabilities 7,937 2,214
205,504 210,062
Non-financial items
Accrued expenses to related parties 366 179
366 179
Total non-current trade and other payables 205,870 210,241
((1) ) Trade payables and accrued expenses relate primarily to
development expenditure on the Karish project, with the main contributors
being FPSO and subsea construction costs and for drilling activities performed
offshore Israel. Trade payables are non-interest bearing.
((2) ) In December 2016, the Company acquired the Karish and Tanin
leases for US$40 million of upfront consideration plus contingent
consideration of US$108.5 million (paid over 10 equal instalments) bearing
interest at an annual rate of 4.6%. On 30 June 2023, the total discounted
deferred consideration was US$41 million (31 December 2022: US$52million).
((3) ) This represents the amount payable to Technip in respect of
the EPCIC contract. Under this contract, US$250 million becomes payable nine
months following the practical completion date (as defined under that
contract), and is payable in eight equal quarterly instalments, bearing no
interest. A discount rate of 5.831% has been applied (being the yield rate
of the senior secured loan notes, maturing in 2024, at the date of entering
into the settlement agreement). The amounts payable to Technip up to 30 June
2024 under this contract are presented as part of trade accounts payable -
current.
((4) ) The contract liability relates to the agreement with Israel
Natural Gas Lines ("INGL") for the transfer of title (the "Hand Over") of the
near shore and onshore segments of the infrastructure that delivers gas from
the Energean Power FPSO into the Israeli national gas transmission grid. The
Hand Over became effective in March 2023. Following the Hand Over, INGL is
responsible for the operations and maintenance of this part of the
infrastructure and the related asset (refer to Note 7) and contract liability
was derecognised. The final $5million consideration is receivable within 12
months of handover and is recognised within other receivable (refer to Note
10)
NOTE 14: - Financial Instruments
Fair Values:
Fair value is the amount for which the asset or liability could be exchanged
in an arm's length transaction at the relevant date. Where available, fair
values are determined using quoted prices in active markets. To the extent
that market prices are not available, fair values are estimated by reference
to market-based transactions or using standard valuation techniques involved.
Values recorded are as at the balance sheet date and will not necessarily be
realised. There were no transfers between fair value levels during the year.
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 at 30 June 2023 (unaudited)
Level 1 Level 2 Total
$'000 $'000 $'000
Financial assets
Long term other receivables - 4,949 4,949
Short term restricted cash 8,481 - 8,481
Short term trade and other receivables - 96,282 96,282
Cash and cash equivalents 64,688 - 64,688
Total 73,169 101,231 174,400
Financial liabilities
Senior secured notes ((1)) 2,311,875 - 2,311,875
Trade and other payables - long term - 205,504 205,504
Trade and other payables - short term - 178,822 178,822
Total 2,311,875 384,326 2,696,201
Fair value hierarchy as at 31 December 2022
Level 1 Level 2 Total
$'000 $'000 $'000
Financial assets
Short term restricted cash 71,778 - 71,778
Short term trade and other receivables - 76,509 76,509
Cash and cash equivalents 24,825 - 24,825
Total 96,603 76,509 173,112
Financial liabilities
Senior secured notes ((1)) 2,298,125 - 2,298,125
Trade and other payables - long term - 210,062 210,062
Trade and other payables - short term - 252,730 252,730
Total 2,298,125 462,792 2,760,917
((1)) The senior secured notes are measured at amortised cost in the Group's
financial statements. The notes are listed for trading on the TACT
Institutional of the Tel Aviv Stock Exchange Ltd (the "TASE"). The carrying
amount as of 30 June 2023 was US$2,475 million and as of 31 December 2022 was
US$2,471 million.
NOTE 15: - Significant events and transaction during the reporting period
(a) Gas Sales Agreements - Energean signed spot gas sale and purchase
agreement with three Israeli gas buyers. The gas price will be determined in
each period, with purchased amounts determined on a daily basis. The agreement
will be valid for an initial one-year period with an option to extend subject
to ratification by both parties.
(b) INGL Hand-Over completion - The Hand Over became effective in March
2023. Following the Hand Over, INGL is responsible for the operations and
maintenance of this part of the infrastructure.
NOTE 16: - Significant events and transaction after the reporting period
Pricing of an offering of US$750,000,000 senior secured notes
Subsequent to period end, Energean Israel Finance Ltd. has priced the offering
of US$750 million aggregate principal amount of senior secured notes due
September 30, 2033, with a fixed annual interest rate of 8.500%. The interest
on the Notes will be paid semi-annually, on March 30 and September 30 of each
year, beginning on March 30, 2024.
The issuance of the Notes was completed on July 11, 2023, subject to
satisfaction of customary conditions. The Notes are expected to be listed for
trading on the TASE-UP of the Tel Aviv Stock Exchange Ltd. (the "TASE"),
subject to the approval of the TASE.
The proceeds from the Offering, upon release from escrow are expected to be
used to refinance the $625 million notes due in 2024, pay fees and expenses
associated with this refinancing, contribute towards funding the interest
payment reserve account, and contribute towards the payment of the final
deferred consideration to Kerogen.
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