Greece deepens US energy ties with first exploratory offshore drilling deal in 40 years

Greece has signed its first exploratory offshore drilling agreement since 1981, in a landmark deal led by ExxonMobil that signalled growing Washington interest in the eastern Mediterranean.

The new drilling deal involving ExxonMobil, Energean and HelleniQ Energy, allows exploration in the Ionian Sea, and is expected to take place in late 2026 or early 2027, subject to applicable governmental approvals and the satisfaction of customary closing deliverables.

The drilling operation will be the first exploratory offshore drilling in Greece in more than 40 years, when the well that led to the discovery of the Katakolo hydrocarbon field was completed.

Over the past two decades, the only offshore wells carried out in Greece have been production wells in Prinos, implemented by Energean.

Last week, the companies ExxonMobil, Energean, and HelleniQ Energy announced the Farm-In Agreement for ExxonMobil’s participation in the Block 2 concession, located in the northwestern Ionian Sea, adjacent to the Italian Exclusive Economic Zone (EEZ).

Block 2, located in the northwestern Ionian Sea, an area of significant geological interest adjacent to the Italian EEZ, is considered the most mature concession in Greece in terms of readiness for exploratory drilling.

In 2022, 2,244 square kilometers of 3D seismic data were acquired. Their processing and interpretation confirmed that the “Asopos” structure is the most mature target for exploratory drilling.

It is the largest unexplored offshore structure in the Mediterranean, with potential prospects to substantially enhance the energy security of Greece and the broader region.

Under the terms of the agreement, ExxonMobil acquires 60% of the concession, Energean’s participation is set at 30%, down from 75%, whilst HelleniQ Energy’s participation is set at 10%, down from 25%.

Energean will remain the operator of the concession during the exploration stage.

In the event of a hydrocarbon discovery, ExxonMobil will assume operatorship during the development stage.

U.S. officials who attended the signing ceremony at the Athens conference lauded Thursday’s deal.

“Today in Athens, ExxonMobil signed a landmark deal with Greece’s Energean PLC to restore offshore gas drilling in the Ionian Sea for the first time in more than 40 years,” US Secretary of Energy Chris Wright said in a post on X on Nov. 6.

The participation of a US oil major in the drilling deal further underlines Washington’s strategic footprint in the eastern Mediterranean.

Sources in the Greek ministry of environment and energy describe the agreement signed last week between ExxonMobil, Energean and HelleniQ Energy for the exploratory offshore drilling in the Block 2 concession, located in the northwestern Ionian Sea, as a vote of confidence for Greece.

“Greece is emerging as one of Europe’s newest and promising regions for hydrocarbon exploration and development. This transaction represents a positive step not only for the joint venture partners, but also for the Greek economy,” said Andreas Shiamishis, chief executive officer of HelleniQ Energy.