Shares in oil and gas firm Energean (ENOG) continue to rise as it benefits from higher energy prices and first gas from its Karish field offshore Israel in October.

The FTSE 250 constituent is up 68% year-to-date to £14.96 as it has successfully brought the flagship Karish asset on stream.

Berenberg analyst James Carmichael says: ‘This is a significant milestone for the company and should drive material growth in production, cash flow and shareholder return over the next 12 to 24 months.’

The initial contracted sales volumes and prices achieved from Karish underpin long-term cash flow forecasts which imply an average free cash flow yield at the current market valuation of more than 20% between 2023 and 2030.

Based on Energean’s stated dividend policy it could be paying out as much as $100 million on a quarterly basis once it hits production targets, which would represent a 14% yield. Berenberg estimates production will eventually average around 200,000 barrels of oil equivalent per day.

Inevitably given the field’s location there are political and security risks and Lebanese militant group Hezbollah has threatened Karish. The field is situated in waters which are the subject of dispute between Israel and Lebanon.

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