UK's Energean to take over from Total at Greek offshore exploration block

London — UK-listed Energean Oil & Gas -- which is building a portfolio of mostly gas-focused Mediterranean assets -- said Thursday it had agreed to take a 50% stake and operatorship of a block offshore Greece from France's Total.

Energean said the deal to take over at Block 2 provided "further material exploration opportunities" in its core area of the Eastern Mediterranean with "limited financial exposure."

"The deal further enhances the future growth potential of Energean's portfolio," it said.

The other partners at Block 2 are Italy's Edison E&P (25%) and Greece's Hellenic Petroleum (25%).

Energean hopes to close the $850 million acquisition of Edison E&P in the first half of 2020, after which its stake in Block 2 will increase to 75%.

Work to date on the license has identified that Block 2 contains part of a large, potential target thought to be an analogue to the Vega field offshore Italy, Energean said.

Vega is operated by Edison E&P with a 60% stake.

Energean's net remaining expenditure to satisfy the minimum work obligation at Block 2, which includes 1,800 km of 2-D seismic acquisition and processing, is some Eur500,000 ($549,000), it said.

The new seismic activity could "significantly de-risk the prospectivity" of the license, it added.

The feature straddles the Greek and Italian maritime border with approximately 60% of the prospect within the Block 2 license with the remaining part in Italian waters.