![]() 2022 ## Annual Report ### Energean plc #### www.energean.com ![]() STRATEGIC REPORT #### Key Metrics and Report Highlights 2022 2021 % change Average working interest 2P reserves and 2C resources (MMboe) 1,378 1,154 19% Average working interest production (kboepd) 41.2 41.0 0.5% Sales revenues ($ million) 737 497 48% Cost of production ($/boe) 18.9 17.5 8% Adjusted EBITDAX ($ million) 1 422 212 99% Operating profit ($ million) 232 32.1 623% Profit/(loss) after tax ($ million) 17 (96) 118% Cash flow from operating activities ($ million) 272 133 105% Net debt / (cash) ($ million) 2,518 2,017 25% Operational Highlights Karish onstream First gas was safely delivered at Energean’s flagship project on 26 October 2022. Initially flowing from one well, all three production wells were brought online by year-end, with excellent reservoir deliverability confirmed. Energean has completed commissioning under the GSPAs and, at the time of writing, is sequentially notifying gas buyers that commercial obligations have commenced. Energean is on track to complete the FPSO debottlenecking by year-end 2023 (see pages 39-40 for further details). Key development projects on track First gas from the first well at NEA/NI was brought onstream in March 2023. Energean’s other key development projects, (Karish North and Cassiopea) are on track to deliver Energean’s 200 kboepd production target in H2 2024 (see pages 41-42 for further details). Exploration success The 2022 growth drilling programme in Israel was successfully completed and discovered and de-risked 73 bcm (480 MMboe) of new gas volumes. This includes 68 bcm (449 MMboe) of gas volumes in the Olympus Area (Block 12 and Tanin lease), for which the development concept is being finalised (see pages 40-41 for further details) . Corporate and Financial Highlights Commencement of dividend payments In total, Energean returned US$0.60/share to shareholders ($106.5 million) in 2022, in line with Energean’s target to pay dividends of at least $1 billion by end-2025 (see page 38 for further details) . Strong financial performance Record revenues ($737 million) and adjusted EBITDAX 1 results ($422 million) on the back of strong commodity prices (see pages 36 and 67 for further details) . Energean paid a total of $29.3 million of one-off windfall taxes in Italy in 2022. Emissions intensity reduced 13% year-on-year reduction in carbon emissions intensity to 16.0 kgCO2e/boe (see pages 37 and 65-67 for further details) , on track to achieve reduction to 7-9 kgCO2e/boe once Karish is on plateau. 1 The Group uses certain measures of performance that are not specifically defined under IFRS or other generally accepted accounting principles. These non-IFRS measures include adjusted EBITDAX. More information can be found in the Financial Review section, under the heading ‘Non-IFRS measures’. Page 2 of 255 ![]() STRATEGIC REPORT #### Non-Financial Information Statement The following table constitutes our Group Non-Financial Information Statement in compliance with Sections 414CA and 414CB of the Companies Act 2006. The information listed is incorporated by cross- reference. Additional Group Non-Financial Information is also available on our website www.energean.com . Reporting Requirement Group Approach and Policies Relevant Information Relevant Pages Environment Environmental Policy Climate Change Policy Zero-Routine-Flaring Policy Task Force on Climate Related Disclosure Environmental policies 17, 61-64 Environmental targets 32 Environmental data 62, 65-66 Environmental KPIs 37, 62 TCFD disclosure 20-32 Employees CSR Policy Equal Opportunities Policy Diversity, Equity and Inclusion Policy Code Of Ethics Corporate Major Accident Prevention Policy Data Privacy Policy HSE Policy for Contractors HSE policies 56-61 HSE KPIs 37 HSE data 56, 60-61 Excellence through our people 52-56 Human Rights Code of Ethics CSR approach 45-52 Excellence through our people 52-56 Social Matters CSR Policy Code of Ethics UN’s 17 Sustainable Development Goals CSR approach 45-52 Anti-Corruption & Anti-Bribery Code of Ethics UK Bribery Act Applicable Local Anti-Bribery Laws Anti-Corruption and Bribery Policy Whistleblowing Policy CSR approach 45-52 Corporate governance 99-108 Governance and Risk Management Corporate Governance Code Principal Risks and Uncertainties Governance & Risk Management Risk management 74-91 Corporate governance 99-108 Audit & Risk Committee 110-115 Business Model Our Business Model N/A 15-16 Strategy Our Strategy N/A 17-19 Non-Financial Key Performance Indicators Key Performance Indicators N/A 37 Page 3 of 255 ![]() #### Contents Key Metrics and Report Highlights ............................................................................................................................ 2 Non-Financial Information Statement ....................................................................................................................... 3 Contents .......................................................................................................................................................................... 4 Strategic Review About Us .......................................................................................................................................................................... 6 Performance in 2022 .................................................................................................................................................... 8 Chair’s Statement ........................................................................................................................................................ 10 Chief Executive’s Review ............................................................................................................................................ 12 Our Business Model .................................................................................................................................................... 15 Our Strategy .................................................................................................................................................................. 17 Task Force on Climate-related Disclosures ........................................................................................................... 20 Market Overview .......................................................................................................................................................... 33 Our Key Performance Indicators .............................................................................................................................. 35 Review of Operations .................................................................................................................................................. 39 Corporate Social Responsibility ................................................................................................................................ 45 Financial Review .......................................................................................................................................................... 67 Risk Management ....................................................................................................................................................... 74 Viability Statement ...................................................................................................................................................... 92 Corporate Governance Board of Directors ....................................................................................................................................................... 94 Corporate Governance Statement ........................................................................................................................... 99 Section 172 (1) Companies Act 2006 Statement ............................................................................................... 106 Audit & Risk Committee Report .............................................................................................................................. 110 Environment, Safety & Social Responsibility Committee .................................................................................. 116 Nomination & Governance Committee ................................................................................................................. 118 Remuneration Report ............................................................................................................................................... 123 Remuneration Policy ................................................................................................................................................. 127 Annual Report on Remuneration ............................................................................................................................ 131 Group Directors’ Report ............................................................................................................................................ 148 Statement of Directors’ Responsibilities ............................................................................................................... 152 Financial statements Independent Auditor’s Report to the Members of Energean plc ...................................................................... 154 Group Income Statement ........................................................................................................................................ 165 Group Statement of Comprehensive Income ...................................................................................................... 166 Group Statement of Financial Position ................................................................................................................. 167 Group Statement of Changes in Equity ................................................................................................................. 168 Group Statement of Cash Flows ............................................................................................................................ 170 Group Accounting Policies and Notes .................................................................................................................. 172 Page 4 of 255 ![]() Company Statement of Financial Position ........................................................................................................... 237 Company Statement of Changes in Equity .......................................................................................................... 238 Company Accounting Policies ................................................................................................................................ 239 Notes to the Financial Statements ........................................................................................................................ 242 Other Information 2022 Report on Payments to Governments ........................................................................................................ 248 Glossary ....................................................................................................................................................................... 252 Company Information .............................................................................................................................................. 255 Page 5 of 255 ![]() STRATEGIC REPORT # Strategic Review #### About Us Energean at a glance The leading independent, gas and ESG-focused E&P company in the Mediterranean Established in 2007, Energean is a London Premium Listed FTSE 250 and Tel Aviv Listed TA-35 E&P company with operations in seven countries across the Mediterranean and UK North Sea. Since IPO in 2018, Energean has grown to become the leading independent, gas-producer in the Mediterranean with a material reserve base of 1,161 boe of 2P reserves (84% gas). Energean’s flagship Karish project was brought safely onstream in October 2022, with excellent reservoir deliverability confirmed. Gas from Karish will be used to help Israel transition away from coal-powered electricity in line with the country’s commitment to close all coal power stations by 2025. Karish, combined with Energean’s other development projects in Israel, Egypt, Italy and Greece, is targeted to grow production from 41.2 kboepd to over 200 kboepd in H2 2024 and achieve the Group’s revenue and EBITDAX targets of $2.5 billion and $1.75 billion, respectively. Over 75% of the near-term production target is underpinned by long-term gas contracts with floor pricing, which ensures cash flow predictability. Energean is also poised for further value-creation following the discovery of additional gas resources offshore Israel in 2022. This includes 68 bcm (449 MMboe) of gas volumes in the Olympus Area (Block 12 and Tanin lease), for which the development concept is being finalised. The Company has a disciplined capital allocation policy and is focused on shareholder returns. It aims to provide a reliable and progressive dividend stream and is targeting to pay cumulative dividends of at least $1 billion by the end of 2025. In 2022, Energean returned US$0.60/share to shareholders (approximately $106 million), representing two-quarters of dividend payments. This was aligned with its commitment to return an initial $50 million to shareholders per quarter no later than the end of 2022, which will rise to at least $100 million per quarter (on average) once its stated financial targets are achieved. Energean’s dividend policy has no impact on its targeted deleveraging after first gas to <1.5x net debt/EBITDAX or on operational re-investment to continue its organic growth and opportunistic M&A strategy. Energean had $720 million of liquidity as at 31 December 2022, and has minimal exposure to interest rate rises following its 2021 refinancings. ESG, health and safety is of central importance to Energean. We aim to run safe and reliable operations and are committed to achieving net-zero carbon emissions by 2050 and to reducing our methane emissions. Where we operate Energean holds a balanced portfolio of exploration, development and production assets, with operations in seven countries across the Mediterranean and UK North Sea. We have interests in more than 65 leases and licences, 6 of which are located offshore Israel, one of our core countries of operation. Please see pages 234-236 for a full breakdown of all our licences. Page 6 of 255 ![]() STRATEGIC REPORT Figure 1. Map of Energean’s operations Figure 2. Energean Israel Limited (EISL) leases and licenses Red licences indicate Energean’s acreage which contain discovered volumes. Green licences are Energean’s acreage which have not been explored. Page 7 of 255 ![]() STRATEGIC REPORT #### Performance in 2022 Operational highlights Production #### 41.2 (75% gas) kboepd 2P Reserves #### 1,161 (84% gas) MMboe 2C Resources #### 217 (41% gas) MMboe Financial and corporate highlights Revenues 737.1 $ million EBITDAX 421.6 $ million Dividend #### $106.5 million Distributed in 2022 • 2022 sales revenues of $737.1 million (48.3%; 2021: $497.0 million) • Adjusted EBITDAX of $421.6 million (98.8%, 2021: $212.1 million) • Profit / loss after tax of $17.3 million (118%, 2021: $(96) million) • Cash flow from operating activities of $272.2 million (106.7%, 2021: $132.5 million) • $720 million liquidity at 31 December 2022 • Spot gas agreement signed with the Israel Electric Company (“ IEC ”) for Karish gas and a sales and purchase agreement signed with Vitol for the marketing of a number of cargoes of Karish blend hydrocarbon liquids • Commenced dividend payments, returning a total of 60 US$cents/share ($106.5 million) to shareholders in 2022 • Signed a three-year $275 million Revolving Credit Facility ( “ RCF ”) 2 in September 2022, providing liquidity for general corporate purposes, if needed. Decarbonisation and ESG highlights • 13% year-on-year reduction in carbon emissions intensity to 16 kgCO2e/boe on an equity share basis • 76.6% reduction in carbon emissions intensity since our baseline year (2019) • Verified all scope 1, 2 and 3 emissions to ISO 14064-1 based on the operational accounting approach • Pre-FEED and subsurface study completed and exploration licence awarded for the Prinos CCS project, Greece • Zero-routine flaring policy fully implemented across all operated and JV’s sites • Successful purchase of renewable-sourced electricity (“ green electricity ”) across all our operated sites Energean continued to deliver strong performance against its strategic goals in 2022, producing record financial results and declaring its maiden dividend. Please see the Key Performance Indicators section on pages 35- 38 for more detail. • Working interest production of 41.2 kboepd (75% gas), (2021: 41.0 kboepd (72% gas)) • 2P + 2C reserves and resources of 1,378 MMboe (19%; 2021: 1,154 MMboe) • Karish brought onstream on 26 October 2022, with excellent reservoir deliverability confirmed • Key development projects (Karish North and Cassiopea) on track to deliver 200 kboepd production target in H2 2024 – NEA/NI achieved first gas in March 2023 • Successful completion of the 2022 growth drilling programme in Israel which discovered and de- risked 73 bcm (480 MMboe) of new gas volumes • Including 68 bcm (approximately 449 MMboe) of additional gas volumes in the Olympus Area, for which the development concept is now being finalised. This includes an addition of 31 bcm (approximately 206 MMboe) of 2P reserves in the Olympus Area, offshore Israel, that have been certified by Energean’s reserve auditor, Degolyer and McNaughton (“ D&M ”) 2 $101 million of the $275 million is reserved for Letters of Credit (at 31 December 2022), which replace the Letters of Credit previously issued under the previous facility with ING on a one-for-one basis. Page 8 of 255 ![]() STRATEGIC REPORT • Performed three methane emissions detection campaigns at major process installations in Italy • Achieved an upgraded score of A- for the CDP’s Climate Change disclosure and aligned with all recommended pillars of TCFD disclosure • Continued to implement climate-based scenario analysis and used internal carbon pricing to assist with investment-decision making • ESG ratings in top quartile, awarded the “Platinum” index by MAALA, rated at ‘AA’ by MSCI and 30 out of 112 by Sustainalytics HSE highlights • Safe and reliable operations, zero serious personnel injuries • Zero oil spills and zero environmental damage Awards • Awarded ‘Best ESG Energy Growth Strategy in Europe 2022’ by CFI • Sembcorp Marine’s Admiralty Yard was awarded two Safety and Health Award Recognition for Projects for Safety Excellence for Energean’s FPSO Karish Project, taking the total number of awards to five since the project began in 2020 Page 9 of 255 ![]() STRATEGIC REPORT #### Chair’s Statement Karen Simon, Independent Chair Dear Shareholders, 2022 was a year of significant volatility. A high intensity war in Europe, with the renewed Russian invasion of Ukraine was the catalyst for the world to reconsider the parameters of the global energy dynamic. Without going into the detail here, the world has seen how it has to reconsider the prism through which we view energy. It is clear that whilst we must not waver on the road to a just transition, we cannot pretend that overreliance on singular suppliers are part of the ripple effect that has affected almost every living person on the planet. Energean can be part of the solution to the challenge that we all face. This is not to overstate our role. We cannot replace Russia’s 150 bcm of natural gas exports. However, we are committed to rapidly growing and developing our portfolio, a policy that will benefit both shareholders and our broader stakeholder community. The world needs additional supplies of energy, and natural gas can be both the foundation of and catalyst for a more sustainable energy dynamic. Our role as the largest gas focused E&P company in the Mediterranean has taken on a greater significance in 2022 and we expect this trend to continue. Environmental, Social and Governance The Board and I are keenly focused on ensuring that Energean is managed at the highest levels of environmental, social and governance (“ ESG ”) standards. ESG is at the heart of Energean’s operations. Strategic ESG consideration has three positive drivers: it underwrites our licence to operate with external stakeholders, it positively engages our colleagues around the world and finally, it is good for our collective societal wellbeing. We have always been a leader in the field of ESG consideration. We are committed to outperforming our peer group in this category because it will be good for our business, but more importantly for the communities that host our operations and the global environment. We are proud to have been the first independent E&P company to make a Net Zero pledge. Myself and the Board are very proud that we have significantly outperformed our relevant peer group across all the major ESG ratings agencies. Sustainalytics ESG, Bloomberg, MSCI, Maala & CDP have all maintained their highly positive assessment of our ESG impact. Maala have upgraded our rating to “platinum” and our CDP score has been upgraded to A-, moving us to the higher band, the “Leadership” band of our peer group. I and the rest of the Board recognise that the success of the business depends on our people. Through 2022 we continued to work on the integration of our colleagues across our company, creating a “one team” approach. We aim to maintain a positive, open and collaborative work environment to equip our people from all backgrounds to fulfil their potential. In 2023, we will continue on this road, with Energean’s first Diversity, Equity & Inclusion policy. You can find more detail our external and internal engagement in the CSR section of this Annual Report. HSE The safety of our people will always remain the Board’s number one priority. Safety at Energean is underpinned by our well-structured and continuously improving HSE Management system. I’m pleased to report that we ended the year with zero serious injuries. 2023 will see the investment in, and roll out of, a new integrated issues and crisis management electronic program that will further ensure best-in-class management of any potential risks. Board composition During 2022, I was delighted that Roy Franklin stepped up to become a Senior Independent Director. Roy’s significant experience in the Independent E&P sector is both well recognised by all our stakeholders and we are lucky to benefit from his years of hard won wisdom. I would like to thank Robert Peck, who stepped down from the Board in 2022. Robert’s 5 years of service brought Energean significant value, as his experience of geopolitical engagement as a Canadian diplomat was much in need, as we successfully navigated the waters of the East Med. Page 10 of 255 ![]() STRATEGIC REPORT The opening up of the world post COVID has allowed the Board to meet both in person, and engage with Energean employees across the world. We have met in London and we have visited the FPSO. This is important not only for the effective functioning of the Board, but to also better engage with the workforce of Energean. We must know the people we lead – this supports our commitment to the highest standards of governance. Operational delivery 2022 was the year Energean made the final steps on a long road to first gas from Karish. Energean today produces natural gas and fluids from the only Floating Production and Storage & Offloading vessel in the Eastern Mediterranean. The “Energean Power” is a remarkable feat of engineering, and first gas from Karish was a remarkable achievement. This is not a purely matter of geology and engineering and finance. Energean achieved this success against the uniquely complex geopolitical dynamic of the region. Mathios and the team managed the situation with the correct combination of diplomacy and commitment – demonstrating the unique multi stakeholder value creation capability of an independent E&P company with deep regional understanding. On top of this success, the 2022 drilling campaign has added significant value to the Group. Energean has discovered and de-risked approximately 73 bcm (480 MMboe) of natural gas. This “new” resource can create a major growth catalyst. We look forward to the announcement of how Energean will develop this new resource during 2023. Our strategic direction and 2023 outlook Energean’s purpose is to become the leading, gas focused E&P company in the Mediterranean, with the highest of ESG and HSE standards at the heart of our operations. Our aim is to grow the company to become a 200 kboepd producer and a $1.75 billion per year EBITDAX generator. 2023 will take us a long way on this journey. As we ramp up production from Karish and debottleneck our production capacity on the FPSO as well and optimising production in Egypt and our broader portfolio, we are targeting 131 – 158 kboepd. This increase in production is what gave the Board confidence in sanctioning Energean’s sustainable and progressive dividend policy. Whilst we remain committed to growth and diversification, we will also be a significant producer and which to share our success with our shareholders. Our priorities for 2023 are to build on the success of 2022. (1) We will ramp up production from offshore Israel and invest in the FPSO to enhance production capacity. We will also enhance production across the portfolio, with a particular focus on Egypt, with NEA/NI coming onstream. (2) Our strategic approach to portfolio development means that we can provide both sustainable returns to shareholders while continuing to grow organically. (3) Delivering energy responsibly and safely on our path to net-zero. ESG & CSR will remain at the heart of Energean. (4) This is why we will continue to focus on our people, culture and infrastructure in our transition to a 200 kboepd company. I thank you, our shareholders, new and existing, for your continued support. Karen Simon Independent Chair Page 11 of 255 ![]() STRATEGIC REPORT #### Chief Executive’s Review Mathios Rigas, Chief Executive Officer 2022 – a landmark year for Energean, the Global Energy Dynamic, and the East Mediterranean 2022 was a landmark year for Energean, just as it was a deeply volatile year for the global energy dynamic. The two are somewhat intertwined. In 2022, Energean commenced production from the only FPSO in the strategically vital Eastern Mediterranean region; commenced payment of dividends to our shareholders; and we successfully discovered and de-risked new natural gas resources adjacent to our infrastructure, providing significant potential upside and export optionality. 2022 was the year we made our dream a reality. The Russian invasion of Ukraine has underlined the lack of global upstream investment in the past decade – and the resultant energy security risk of assuming a single dominant supplier would always deliver. The global gas market was tight before Russian supplies were constrained. Now, there is no surplus supply, which drives price volatility and creates an advantage for any producer bringing new molecules onstream, especially if they are adjacent to multiple demand markets. Energean was and remains an Eastern Mediterranean focused exploration and production company. We explore, develop, produce and sell natural gas and fluids from and within the region. In Israel and Egypt in particular, we produce energy for local clients. The Russian invasion of Ukraine however has concentrated the minds of energy policy and commercial decision makers around the world. Our landmark moment of 2022, bringing Karish onstream, both underwrites Israeli energy security and suggests the potential value of regional hydrocarbons in global markets. Record numbers creating sustainable returns Energean is not purely a “Karish” or “Israel” story. In 2022, Energean delivered record financial performance that was driven by strong production in both Egypt and Italy, and our positive exposure to market based pricing, where we were able to benefit from historically high oil and gas prices. Revenues were $737.1 million, a 48% increase versus 2021 comparable period ($497.0 million). EBITDAX was $421.6 million, an increase of 99% versus 2021 comparable period ($212.1 million). 2022 was a transitional year for the Group. In 2023, whilst we remain committed to strategic growth, there remain multiple opportunities in the greater Mediterranean region that are open to consideration; we recognise that we will have completed a major phase of corporate development. As a significant producer of gas and oil, we can share our success with our shareholders and are committed to maintaining our progressive dividend policy. Our operational success, combined with our prudent use of capital creates our core financial strength. This allowed us to commence our progressive and sustainable dividend policy to shareholders in 2022. We have paid out a total of 60 US$cents/shares in 2022, representing two-quarters of dividend payments, to shareholders. A platform for significant operational growth First gas at Karish was complemented by a successful exploration program. The 2022 growth drilling programme in Israel discovered and de-risked approximately 73 bcm (480 MMboe) of new gas resource, including 68 bcm (449 MMboe) of additional gas resource in the Olympus Area, for which the development concept is now being finalised. We have for many years stated that our objective is to transform Energean into a 200 kboepd producing and $1.75 billion EBITDAX generating company. 2022 laid the necessary foundation for us to achieve that objective. The successes of 2022 mean that we project 131 – 158 kboepd production for 2023, with major increases in Israeli production through ramping up Karish and debottlenecking the FPSO, as well as optimising Abu Qir & first gas onwards at NEA/NI in Egypt. Page 12 of 255 ![]() STRATEGIC REPORT 200 kboepd is now within both sight and can be easily mapped. All six of our major projects are on track and are expected to come online over the next two years. In order of timing; NEA/NI (Egypt; which achieved first gas from the first well in March 2023), Karish North and the second gas export riser and oil train (Israel), Cassiopea (Italy) and finally Epsilon (Greece) will take us to and past our goals – all built on the foundation of 2022. Of course there’s more on top of this. We have an extremely exciting and potentially regionally significant exploration project at North East Hap’y in Egypt, that has attracted global industry interest. The well spud is scheduled for 2023. We are also keen to continue our progress with our JV in Croatia, with the Izabela well slated to spud in 2023. ESG & CSR at the Heart of Energean’s Operations Energean’s ESG strategy is to provide affordable and reliable energy, for our shareholders and societies in which we operate. We have chosen to focus on natural gas because it is and will remain the foundation of and catalyst for a more sustainable energy dynamic. Gas is and will continue to be a driver for enhanced sustainable development in the Eastern Mediterranean, displacing more polluting fuels and underwriting energy and economic security. We remain committed to reducing emissions from our operations. We were the first E&P company to announce a Net Zero target and we remain on our clear roadmap for reaching our net-zero target in the short, medium and long-term. Our ESG ratings outperform our peer group and underline our leadership position. Sustainalytics, MSCI, Maala, FTSE4Good, CDP and Bloomberg ratings all independently verify not only our ambition, but our ongoing commitment. Our Prinos CCS project is the East Med’s only Carbon Capture & Storage project under evaluation. We have worked with both Halliburton and Wood to assess the potential of the projects and have successfully qualified for funding from the European Commission’s Recovery and Resilience Fund. At the time of writing, we are in discussions with third party CO2 providers and are applying for additional funding from the European Innovation Fund. 2023 will be a critical year in making a potential project a commercial reality. Finally, we have continued to place ourselves at the heart of the local communities that host our operations. We work together with community stakeholders, positively engaging with our communities through cultural events, sponsorships, donations and the provision of educational and professional opportunities. Health and safety remains our top priority During 2021, we continued to ensure that our all our staff across all sites remained protected against COVID-19 as we came to the end of the global pandemic We are proud to have continued our excellent safety record – at a group level, and alongside our contractors, we achieved an LTIF 3 of 0.47 per million hours which is within the target of 0.5 set for the year. Energy security requires intelligent policy support The world needs secure supplies of energy, and the time has not arrived when renewable / green energy can take the place of hydrocarbons. The reality of today is that we need more of everything. More nuclear, more green, more hydrocarbons. As populations continue to grow, energy demand will continue to grow, and if upstream investments are not made, then the price volatility following the Russian invasion of Ukraine will become the new normal. This is why we implore all policy makers to consider the combination of energy security and the value of domestic supply when considering fiscal policy. We want to work in partnership with governments and are very keen to continue investing in major upstream projects. Israel and Egypt have incentivised domestic energy production. We hope other governments will learn the lesson. Outlook for 2023 Energean is poised to become a major regional producer of hydrocarbons in a strategically vital region. We are in the middle of three hot markets (Israel, Egypt and the EU) and have significant organic growth opportunities to create value for all our stakeholders through 2023 and beyond. In the medium term, the world and in particular our markets’ energy demand will continue to grow. 3 Lost Time Injuries Frequency: The number of Lost Time Injuries per million hours worked. Page 13 of 255 ![]() STRATEGIC REPORT Europe in particular remains gas hungry. A globally tight gas market, and a return of demand from China means that energy security should remain high on policy makers’ agendas. Energean, with our unique portfolio of assets in a strategically vital region could be part of the answer to this challenge – whether that is through increased domestic production, or through new export liquidity. Our growth and our success are the results of outstanding teamwork. We have an industry leading team at Energean. This is why we are the leading gas focused E&P in the region – because our colleagues buy into our vision and are committed to achieving our goals. 2023 will be an exciting year. The reason it is so exciting is that we are entering a new stage in our development. Energean is a sophisticated, ESG focused, corporately robust, natural gas focused energy production company. Mathios Rigas Chief Executive Officer Page 14 of 255 ![]() STRATEGIC REPORT #### Our Business Model Our purpose Energean’s aim is to lead the energy transition in the eastern Mediterranean through a strategic focus on gas and achieve its net-zero ambition in advance of 2050, whilst delivering meaningful and sustainable returns to our shareholders. Our business model Across each part of the hydrocarbon lifecycle we work to create value for our investors, host countries and people. Energean’s business model is to find and monetise hydrocarbons from its portfolio of assets across the Mediterranean. Our activities are focused on generating sustainable cashflow from production through selective development and appraisal of the highest return growth options with a focus on those opportunities with the lowest carbon intensities. We are focused on organic growth, but will continue to evaluate inorganic opportunities that complement and supplement our strategic targets and ambitions. Underpinning our business model is a strategic focus on gas and a commitment to be a net-zero emitte r 4 by 2050. Our value life cycle Find and Appraise Through targeted exploration and appraisal in the Mediterranean we aim to find hydrocarbons, to build reserves and resources, to monetise, or to selectively develop for future production. We have a ranked portfolio of prospects for drilling and remain agile to take advantage of opportunities that support our organic-focused growth strategy. Develop We focus on selective development of material hydrocarbon discoveries we have either found or acquired. We invest in low-cost, high-return drilling options that lie in close proximity to existing infrastructure and aim to deliver cost-effective, timely solutions to convert reserves into cash flows. In developing these solutions, minimising carbon emissions is at the forefront of our minds, and we apply an internal carbon pricing system in assessing new projects and investment opportunities. Produce Production is the cash engine of our business and we are investing in options to maximise production across our producing assets in the Mediterranean, whilst also investing in opportunities to reduce the carbon footprint of these assets, such as the switch to sourcing electricity from 100% renewable sources through the national grid in Greece, Israel, Italy and Croatia. In addition, Energean is committed to evaluating carbon, capture and storage opportunities, and this will continue in 2023. 4 Scope 1 and 2 emissions. Page 15 of 255 ![]() STRATEGIC REPORT Acquire Energean also seeks to grow its portfolio through highly selective and value accretive M&A that are a natural strategic fit, such as the Edison acquisition in 2020 and the consolidation of our Israel position through the Kerogen acquisition 5 in 2021. Our Strategic Pillars 5 Energean’s acquisition of Kerogen’s 30% stake in Energean Israel closed on 25 February 2021. Page 16 of 255 ![]() STRATEGIC REPORT #### Our Strategy 1 East Mediterranean Energean has a long-standing history of operating in the Mediterranean, having originated in Greece in 2007 with the purchase of the Prinos assets for approximately $1.5 million. We have demonstrated our ability to deliver growth and value in the Mediterranean and expect to continue to maintain our strategic focus and investment in this area. We know the governments and we know the rocks in this geographical area, and will continue to leverage this understanding and knowledge to grow the business. 2 Gas We are committed to focusing our production mix in a way that promotes the Mediterranean’s energy transition and creates long-term value for all or our stakeholders. Natural gas emits only half as much CO2 as coal, yet a large percentage of electricity generated in the region comes from coal-fired power plants. Replacing these facilities with gas-fired units is one of the fastest, most efficient and cost-effective ways to reduce global CO2 emissions. Israel, our core market, has understood this, as the Israeli government’s decision to convert all coal powered stations to gas by 2025 attests. The Ministry of Energy is also targeting a fuel mix of 70% gas and 30% renewable energy by 2030. However, the natural gas of the Mediterranean is not just a near-term energy transition source, it is also an energy of the future. The region has sufficient large-scale natural gas resources to provide a sustainable supply to meet rising regional energy demand. Gas is also sustainable and efficient, and its flexibility as an energy source allows for agile production facilities. This makes gas a good partner for renewable energies, providing a useful backup source when there is no sunlight or wind. 3 Tackling Climate Change and the Energy Transition Energean is fully committed to taking action on climate change, supporting the Paris Agreement, in particular Article 2.1(a) which states the goal of keeping the increase in global average temperatures to below 2°C above pre-industrial levels and pursuing efforts to limit the temperature increase even further to 1.5°C. To do this, as recognised in Article 4.1 of the Paris Agreement, we are committed to achieving net-zero emissions by 2050. Energean was the first E&P company in the world to announce a net-zero by 2050 target in respect of absolute Scope 1 and Scope 2 GHG emissions. Our baseline year is 2019 and our commitment covers all existing and future assets. This commitment will be delivered through the implementation of our Climate Change Strategy, published in 2021, which provides a blueprint for reducing our greenhouse gas (“ GHG ”) emissions and strengthening our low carbon portfolio. This report contains our short (by 2025), medium (by 2035) and long-term (by 2050) plans to reach this, details of which can be found within this Annual Report between pages 30-32. In regards to scope 3 emissions, Energean has not set a specific commitment on reducing emissions, but it is considering tangible actions to reduce scope 3 emissions. Energean’s Group Procurement Policy and HSE Policy encourages preference given towards vendors and contractors who can demonstrate emissions reduction policies. In 2022, Energean has continued to publish its scope 3 emissions. This data can be found on page 65 in the CSR section – 2022 data will be disclosed in this year’s CDP Report. 4 Organic Growth At the core of this strategic pillar is our commitment to explore, develop and learn. We explore new ways to find, produce and develop hydrocarbons. We explore new technologies and low carbon solutions, such as carbon capture and storage and blue hydrogen. We at Energean believe that this mindset, combined with our strong subsurface and technical expertise, will enable us to deliver a growth strategy that is sustainable, successful and will lead to the achievement of our near-term financial and operational targets. It was this approach that bore fruit in 2019 with the discovery of Karish North. By actively pursuing new Page 17 of 255 ![]() STRATEGIC REPORT exploration opportunities in core areas and maximising output from producing fields, we aim to ensure at least 100% reserves replacement on an annual basis. Our exploration portfolio is spread across the Mediterranean and represents a balanced mix of new frontier areas and lower risk mature basins. Our Israel drilling campaign commenced in March 2022 and in the year we made four gas discoveries (Athena, Zeus, Hermes and Hercules), discovering approximately 36 bcm, and derisking 37 bcm in the wider Olympus Area. We expect to announce a development concept for the Olympus Area in the coming months . 5 Value and returns-driven Disciplined capital allocation that maximises total shareholder returns is a top priority for Energean. In March 2022, we announced our dividend policy, wherein we committed to return at least $1 billion to shareholders by end-2025. In the policy, we also committed to an initial $50 million per quarter, starting no later than Q4 2022, ramping-up in line with Energean’s near-term production and revenue targets to at least $100 million per quarter. Energean is committed to providing a reliable and progressive dividend, with no impact on targeted deleveraging after first gas to <1.5x net debt/EBITDAX nor on operational re- investment to continue our organic growth and opportunistic M&A strategy. In 2022, Energean returned a total of US$0.60/share to shareholders (approximately $106 million), representing two-quarters of dividend payments. 2022 dividend payments Quarter Cash dividend Declaration date Ex-dividend date Record date Payment date Q2 2022 30 US$ cents per share 8 Sep 2022 LSE – 15 Sep 22 TASE – 16 Sep 22 LSE – 16 Sep 22 TASE – 18 Sep 22 30 Sep 2022 Q3 2022 30 US$ cents per share 17 Nov 2022 LSE – 8 Dec 22 TASE – 11 Dec 22 LSE – 9 Dec 22 TASE – 9 Dec 22 30 Dec 2022 In 2021, we optimised our capital structure via the raise of over $3 billion of bonds, with fixed interest rates. We remain focused on maintaining an optimal capital structure throughout the cycle. Our near-term target is to lower net debt / EBITDAX to <1.5x, and to pay down debt according to a fixed repayment schedule with refinance options available. M&A will also play a role in growing the business; however, we will only do deals that are a strong strategic fit and value accretive. Energean was built through four value-accretive acquisitions. We continue to assess all available opportunities in the region. All M&A opportunities are also tested against our climate change plan to ensure they align with our ESG strategy. Business model foundations Page 18 of 255 ![]() STRATEGIC REPORT These are the building blocks that every E&P business need and are critical foundations for what we do and how we do it. Safe, Reliable and Responsible Operations We value the safety of our workforce above all else and focus on maintaining a safe operating culture every day. This culture of safety also improves the integrity and reliability of our assets. Partnerships and Collaboration We aim to build long-term relationships with our key stakeholders, and partner with leaders of industry to find innovations that can improve efficiency and deliver low carbon solutions. Talented People We work to attract, motivate and retain talented people and provide our employees with the right skills for the future. Our performance and ability to grow depend on it. Governance and Oversight Our board has a diversity of knowledge, expertise, and ways of thinking that help us grow our business, manage risks and continue to deliver long-term value. Technology and Innovation New technologies help us produce energy safely and more efficiently. We selectively invest in areas with the potential to add greatest value to our business, now and in the future, including lower carbon solutions. Page 19 of 255 ![]() STRATEGIC REPORT #### Task Force on Climate-related Disclosures Energean is committed to addressing the environmental impact of our operations. In compliance with the FCA’s listing rule 9.8.6(8), Energean has continued to support the recommendations of the Task Force on Climate-related Financial Disclosures. We set out below our climate-related financial disclosures consistent with all of the TCFD recommendations and recommended disclosures. By this we reference the 2021 Annex “Implementing the Recommendations of the Task Force on Climate-related Disclosures.” Governance: Disclose the organisation’s governance around climate related risks and opportunities a. Describe the board’s oversight of climate-related risks and opportunities Energean sees climate change as a major global concern and a top priority for our business. This is reflected in our strategy, and we apply all our governance processes to climate change-related issues. Responsibility for the governance of climate change issues within Energean rests with the Board. To reflect the increasing importance of climate change-related risks and opportunities, the ESSR Committee has taken over responsibility for climate change matters on behalf of the Board. The Board is also charged with reviewing investments for climate-related risks (among other risks). The ESSR Committee evaluates Energean’s policies and systems for identifying and managing ESG risks, which includes identification of emerging risks, such as climate change risks, and proposes mitigation measures. The Committee further ensures Energean’s compliance with relevant regulatory requirements and/or applicable international standards and guidelines. The Committee follows political and regulatory discussions and developments on an international, EU-wide and national level on a variety of ESG issues, including energy, climate and environment, and industrial trends, etc. The ESSR Committee convenes three times a year and reviews the Board papers on Energean’s carbon emissions performance and KPIs where possible when the Committee meets before a Board meeting. In addition, the Audit & Risk Committee looks at climate change-related issues, to ensure the identification of multi-disciplinary risks (including climate change-related risks), which may impact more than one part of the Company. This Committee is responsible for ensuring that measures to mitigate and adapt to the risks identified are effective and implemented as necessary. The Remuneration & Talent Committee has responsibility for the annual directors’ bonus targets, long term incentive plans, and the overall Remuneration Policy. Both the annual directors’ bonus targets and the long-term incentive plans link executive bonuses to the achievement of emission reduction targets. For more information on how remuneration is linked to sustainability targets, please refer to pages 13 1-147 in the Corporate Governance section of this Annual Report. b. Describe management’s role in assessing and managing climate-related risks and opportunities The Board sets the Company’s values and standards, including the Group’s long-term objectives and commercial strategy, and ensures that its obligations to its shareholders and others are understood and met. Day to day responsibility and accountability for the Company’s environmental and climate change policy, strategy and targets related to short, medium and long-term plans lies with the CEO. The CEO is responsible for identifying and assessing business and climate-related risks, defining the strategy and approving action plans suitable to control and mitigate the identified risks. Furthermore, the CEO oversees the Company’s overall environmental performance and sets climate performance expectations and targets. The CEO discusses all relevant actions and activities related to climate change and the energy transition with the Board. The CEO and the Board regularly discuss climate change-related issues, such as climate change policies, investment decisions where climate change considerations are a major driver, and the carbon credit price’s impact on Energean’s future financial performance. The operational management of climate change issues is conducted by the HSE Director, who reports directly to the CEO and provides updates to the Board on a regular basis. The HSE Director maintains and oversees the development of Energean’s Corporate HSE and Climate Change Policy, defines appropriate training programmes and drills for the entire Company to increase safety, environmental and climate change awareness, and monitors technological developments and opportunities to help achieve defined, Page 20 of 255 ![]() STRATEGIC REPORT appropriate climate change targets. The HSE Director is tasked with ensuring that the Company stays on track to meet its net-zero 2050 target. The HSE Director oversees the monitoring of Energean’s carbon emissions throughout all assets and defines the carbon emission factors that Energean’s financial team uses to understand the financial impact of climate change on Energean’s portfolio. Furthermore, the HSE Director assesses the climate risks and opportunities in cooperation with Energean’s financial, economic and technical departments. Strategy: Disclose the actual and potential impacts of climate-related risks and opportunities on the organisation’s businesses, strategy, and financial planning where such information is material a. Describe the climate-related risks and opportunities the organisation has identified over the short, medium and long term In setting and monitoring the delivery of Energean’s strategy (pages 17- 19), the Board and Management team consider climate relate risks and opportunities across the following three time horizons: • Short-term (to 2025) • Medium-term (to 2035) • Long-term (to 2050) Energean conducts detailed financial projections over a five year period. This currently fully covers the short and partly covers the medium-term horizons mentioned above. Looking beyond this, we consider the potential risks and opportunities and adjust our planning if appropriate. Climate-related issues, in particular physical risks, manifest over longer-term horizons, and so pose less of a risk to our operations. b. Describe the impact of climate-related risks and opportunities on the organisation’s businesses, strategy, and financial planning Inclusion of climate-related risks into decision making and business planning The Board is charged with reviewing investments for climate-related risks. The CEO and the Board regularly discuss climate change-related issues such as investment decisions where climate change considerations are a major driver and the carbon credit price’s impacts on Energean’s financial future. Energean’s business plan is underpinned by assumptions made to, but not limited by: commodity prices, exchange rates, carbon prices, schedules of capital investment and risks and opportunities that m ay have an impact on revenue and free cash flow. The level of uncertainty increases over longer time horizons. The findings of the scenario analysis exercise (see pages 27-28), as well as stringent stress-tests for new investments, inform our corporate strategy and investment decision-making, ensuring that climate change-related risks are adequately considered in managing our portfolio. This includes planning capital allocations and making business decisions based on criteria that are as challenging as those posed by the carbon constrained scenarios examined. Our current portfolio remains resilient under the climate scenarios tested, and we expect to continue helping meet global energy demand over the coming decades. We will continue to make capital allocation decisions for our portfolio using rigorous planning assumptions flowing from the scenario analysis exercise, such as the evaluation of FID of Irena in Croatia and for any M&A decisions. Risks and opportunities Climate change related risk and opportunities have been identified, and future scenarios that aid in developing an integrated strategy approach have been analysed. Our strategy and business contribute to limiting global warming and has been structured, and is currently being implemented, in three different phases; short, medium and long-term, as per our Climate Change Policy published in 2021. The below table presents the risks associated with climate change, as per the Principal Risks in the Risk Management section of the report (pages 89-9 0), but with more detail. Page 21 of 255 ![]() STRATEGIC REPORT The process for identifying and assessing climate-related risks is set out under the climate-related Risk Management section below, on pages 74-77. Physical risks Risk Acute Chronic Description Increased severity of extreme weather events such as flooding, may impact Energean’s normal course of operations. This may also result in damage to infrastructure and increase associated costs. Atmospheric or sea temperature rises m ay cause faster degradation of the company’s infrastructure and necessitate operational changes to the running of the plants. Financial impact Increased severity of extreme weather events may lead to reduced revenue from decreased production capacity, transport difficulties and supply chain interruptions. Early retirement of existing assets m ay possibly arise, e.g. damage to property in “high-risk” asset locations. It also m ay lead to uncreased insurance premiums for insuring assets at high-risk locations. Increased operating costs may arise from potential inadequate water supply for energy producing plants due to changes in precipitation patterns. In addition, increased insurance premiums m ay occur for insuring assets at high-risk locations. Risk rating Medium Medium Time- horizon Long-term Long-term Energean’s response (mitigation) Energean is monitoring the weather conditions near its assets and has built protective barriers to combat potential flooding. No extreme weather events have occurred to date, but the threat remains. The risk has been recognised by the company and we have assessed asset sensitivity to natural disasters following the EU Directive 2014/52/EU and we are monitoring these conditions. Metocean data are fed to the risk assessment procedures. The Audit & Risk committee is incorporating the abovementioned data for the assessment of already existing or new projects. Energean’s is monitoring the conditions at all sites and has incorporated this data into assessments of both existing and new projects. The Audit & Risk committee is incorporating the abovementioned data for the assessment of already existing or new projects. Geographies impacted Our offshore sites are considered at the highest risk, while onshore sits are facing a moderate risks. All assets in all countries Metrics used to assess risk Air temperature and sea-level measurements Air temperature and sea-level measurements Page 22 of 255 ![]() STRATEGIC REPORT Transition risks Risk Policy/Legal Technology Market Reputation Description a) EU Emissions Trading System (ETS) prices are expected to increase, resulting in higher operational costs (in Greece) and possible additional taxes for exceeding GHG emissions. b) Carbon emissions taxes m ay be applied in the future in Israel and Egypt, which would increase the operational costs. The development of new technologies and alternative energy sources m ay result in reduced demand for the company’s products. Increased energy demand m ay also accelerate the development of renewable energy production and storage. Changing customer behaviour m ay reduce demand for our oil and gas products. An excess of supply over demand m ay also lead to lower global commodity prices. Pollution incidents, both through liquid spills and GHG emissions, m ay lead to the loss of investor confidence and subsequent loss of revenue. Financial impact a) Increased pricing of GHG emissions m ay lead to increased operating costs (e.g. higher compliance costs and potential increased insurance premiums). Assets that emit extensively may be subject to early retirement due to policy changes. Regulatory changes in the EU ETS shall gradually lead the company to no longer receive free GHG allowances, leading to increased operational costs. The company currently receives allowances and has a portfolio of allowances that m ay be used in future years. The number of free allowances decreases y-o-y. b) Carbon emissions taxes m ay be applied in the future in Israel, which would increase the operational costs. Technological changes m ay lead to reduced demand for our hydrocarbon products, which could lead to the early retirement of existing assets. We also risk investing in research and development (e.g. on CCS and Eco- hydrogen) if they are unsuccessful – albeit the current expenditure is minor compared to the rest of the Group. Market risks m ay lead to reduced demand for goods and services due to a shift in consumer preferences. This m ay also affect the cost of production. As the supply of products m ay change in the future, a re-pricing of assets m ay take place due to fossil fuel reserves, land valuations etc. Poor reputation m ay adversely impact the company by decreasing the demand for its goods and services. It m ay also reduce the company’s production capacity, due to delayed planning approvals and supply chain interruptions. A negative reputation m ay also block access to finance as investors move away from E&P companies and cause litigation damage from climate action. Risk rating Medium Medium Medium Low Time horizon Medium term Long term Long term Short, medium and long term Page 23 of 255 ![]() STRATEGIC REPORT Transition risks Risk Policy/Legal Technology Market Reputation Energean’s response (mitigation) a) Energean is targeting to reduce its emissions to mitigate the impact of carbon taxes. In Greece, for example, it is currently evaluating the development of a CCS site in the Prinos asset, which has been included in the Recovery & Resilience Fund (RRF) implementation proposal for Greece. b) Energean has imposed shadow pricing to be used as a sensitivity tool in order to assess the viability of the project in Israel. The annual free cash flow was not significantly affected and the project was proven not to lose value in the face of carbon taxation. For more details on the impact of sensitivities to carbon prices, please refer to page 190 in the Estimation uncertainty section of the Financial Statements in this Annual Report All pre-FEED activity costs regarding the Prinos CCS project are currently being funded by existing EU facilities. Energean. Energean fully incorporates climate and market-risks into investment decision making to ensure risks are adequately managed. Energean fully incorporates climate change-related risks into investment decision-making. The findings of the recently conducted scenario analysis exercise (see pages 27-28, as well as stringent stress-tests for new investments, inform our corporate strategy and investment decision-making, ensuring that climate change- related risks are adequately considered in managing our portfolio. Energean is assessing the risks associated with pollution, including climate related risks, at the company and asset level and takes all necessary control and mitigation measures which are reviewed the Audit & Risk Committee on an annual basis and included in the business risk management. Geographies impacted Currently impacted: Greece and UK (assets participate in the EU and UK ETS). Risk of future impact: Israel (Energean’s largest source of production in 2023) and Egypt Greece and Italy are considered to be the most vulnerable assets regarding oil production. Greece and Italy are considered to be the most vulnerable assets, as per the TCFD scenario analysis modelling (see pages 27-28). Highest risk related to oil production assets in Greece and Italy. Metrics used to evaluate risks Carbon emissions and carbon prices. Realised commodity price Realised commodity prices & Cost of Production (see pages 67-68) Hydrocarbon spills & revenue (see pages 66-67) Page 24 of 255 ![]() STRATEGIC REPORT Opportunities Opportunities Resource efficiency Energy source Products/services Markets Resilience Description a) The continuous development of technology provides new opportunities in the field of resource efficiency. Optimized operations are able now to consume less water and energy, increasing the value of fixed assets and the production capacity. b) Reinjection of sour gas in the Prinos field instead of processing it and thus reducing energy consumption. The energy transition creates the opportunity for Energean to reorient its portfolio towards gas, which is deemed to be a transition fuel, and correspondingly increase production capacity. Development and/or expansion of low emission goods and services. Energean expects the development of appropriate carbon capture, and storage (CCS) technology in conjunction with blue- hydrogen to provide low carbon energy to the market. We also expect to provide the opportunity to third parties to sequester their emission in parallel. Energean’s gas focused strategy is aligned with the East Med’s rising gas demand. The Companyy’s resilience to commodity price fluctuations comes hand in hand with the new market opportunities. Transition to gas production is considered the key to Company’s enhanced resilience to climate change. Financial impact a) Potentially resulting in increased revenues, while transition to more efficient buildings or application of more efficient available technology m ay lead to reduced operating costs through efficiency gains and cost reductions. b) Reduces cost of processing sour gas and enhancing production through sour gas reinjection to the field. The re-oriented portfolio leads to reduced operational costs due to lower process needs of the final product, which is mainly natural gas. The reduced exposure to GHG emissions due to the change in the energy mix leads to less sensitivity to changes of carbon cost. Additionally, the energy shift favours the company as there is increased capital availability with more investors to be interested in lower emissions producers. Finally, reputational benefits m ay be resulting due to the increased demand of low carbon services. The products and services that emerge from CCS and Blue-Hydrogen m ay increase the revenues through demand for products and services with lower or zero emissions. Providing products of this kind provides better competitive position to reflect shifting customer preferences, resulting in increased revenues. Gas is considered to be the transition medium to a low-carbon future enhancing Company’s position with increased revenues. Energean’s focus on gas, which is a lower carbon fuel than oil, combined with the long-term gas contracts with floor pricing in Israel and Egypt, protects the Company’s revenue stream from commodity price fluctuations. Materiality level Medium High Medium Medium High Time horizon Short to medium Short, medium and long term Medium to long term Short term Short to medium term Page 25 of 255 ![]() STRATEGIC REPORT Opportunities Opportunities Resource efficiency Energy source Products/services Markets Resilience Energean’s response (strategy to realise opportunity) a) Energean assigned the management of climate change projects to a group company in Egypt named Egypt Energy Services (EES), engaged with energy efficiency projects from cradle to grave and projects also related to low carbon energy generation and carbon sequestration. b) An engineering study of the re-injection process, modification of existing infrastructure, construction of new equipment and vessels and additional pipe-laying will need to be implemented. By shifting its portfolio towards gas, Energean can reduce its carbon emissions intensity whilst also increasing production capacity. Gas will make up 80% of its portfolio and Energean is investing in new gas-orientated assets included in the Edison E&P portfolio. Energean aims to capitalise on the opportunity presented by CCS by drawing on the company’s existing expertise in managing reservoirs. Further to that, Energean is evaluating Blue-Hydrogen in conjunction with its CCS project at Prinos, Greece, and is exploring replicating this in other operated countries. Although the IEA notes that the supply chain m ay struggle with the number of planned projects, Energean believes this risk is low as the number of CCS sites currently under discussion for development in the East Mediterranean is low. Shifting production from oil to gas has already commenced by investing in gas fields that will further expand following Company’s policy. Shifting production from oil to gas has already commenced by investing in gas fields that will further expand following Company’s policy. Geographies impacted Existing assets in Greece, Italy and Egypt are initially targeted. All assets in all countries Initially Greece and subsequently Italy by utilising depleted fields. Further to that Energean also considers its opportunities to develop such projects in Israel as the Company’s future highest production asset. Israel and Egypt are the Company’s main gas producers. Israel and Egypt are the Company’s main gas producers. Metrics used to evaluate opportunity Total water usage and total energy consumption intensity (page 66) % of production which is gas and operational costs (pages 39 and 67-68) CCS and hydrogen related revenue streams Ability to attract investment Revenue (page 67) Page 26 of 255 ![]() STRATEGIC REPORT c. Describe the resilience of the organisation’s strategy, taking into consideration different climate- related scenarios, including a 2°C or lower scenario Energean has taken decisive steps in the previous decade to adjust our business strategy to not only mitigate climate change-related risks but also to capture opportunities. Over the past five years, Energean shifted its portfolio from 100% oil to more than 75% gas, recognising that gas plays an important role as a bridge fuel in the transition to a lower-carbon future. For example, in Israel, gas produced from our operations will be key in replacing high-carbon coal power plants and thus, will play a big role in lowering the country’s absolute emissions by around 3 million tonnes. Portfolio resilience Since 2021, in line with the TCFD’s recommendations, we have tested the resilience of our portfolio against the scenarios from the International Energy Agency’s (“ IEA ”) annual World Energy Outlook (“ WEO ”) report to address the risks and opportunities presented by a potential transition to a lower-carbon economy. Resilience is defined as the ability to generate value in a low-price environment. Energean is developing models to carry out scenario analysis on physical risks, which is not included in the analysis below. Energean has historically assessed asset sensitivity to natural disasters following the EU Directive 2014/52/EU. We have chosen to use the IEA scenarios as it enables standardisation in approach and comparison between companies. The IEA’s scenarios change slightly each year – in the 2022 WEO report, the three scenarios are: IEA’s 2022 WEO climate scenarios Stated Policies Scenario (STEPS) Announced Pledges Scenario (APS) Net-Zero Emissions by 2050 Scenario (NZE) Overview Does not take for granted that governments will reach all announced goals. Instead, it explores where the energy system might go without additional policy implementation Takes account of all climate commitments made by governments around the world and assumes they will be met in full and on time Sets out a pathway for the global energy sector to achieve net-zero CO2 emissions by 2050 Temperature rise 2.5°C by 2100 1.7°C by 2100 1.4°C in 2100 2030 oil price $82/bbl $64/bbl $35/bbl 2030 EU gas price $8.5/Mbtu $7.9/Mbtu $4.6/Mbtu 2030 carbon price $90/tonne $135/tonne $140/tonne Methodology We have applied the IEA’s price forecasts for each scenario to our portfolio and have compared the impact on the net present value (“ NPV ”) for each country versus our base case budgetary assumptions. We have not included our exploration assets in this analysis. The IEA provides 2030 and 2050 oil and gas prices for each scenario. It also provides 2030, 2040 and 2050 carbon prices for each scenario. We have assumed a straight-line increase between the price points and then assumed flat prices from 2050 onwards. Because the IEA provides general oil and European gas prices, we have taken the differential between their base case and their forecast and applied this to our 2021 base case for Brent and the various regional gas prices to generate comparable commodity price forecasts. The impact to net present values described below are based on the development of our 2P reserves position ‘as is’, and do not include any unsanctioned steps that we are taking to mitigate the impacts of climate change. Page 27 of 255 ![]() STRATEGIC REPORT Results Net Present Value of portfolio 6 STEPS APS NZE Israel Egypt Italy Greece UK Croatia Impact on NPV >0% 0 to -10% -11 to -55% >-56% Our portfolio continues to create value under all scenarios and our gas-focused business positions us strongly to adapt to changing demand in a carbon-constrained world. Under the NZE, the NPV is reduced by 17% overall compared to the base case, but remains positive. This is because the portfolio is predominately gas weighted and thus is largely protected against falls in oil prices. In Israel, gas revenues are protected against fluctuations in international commodity prices as there are fixed gas contracts with floor pricing. Only under the NZE is there a minor impact on the NPV (-8%) due to the price realised for the liquids stream. Likewise in Egypt, gas revenues are protected with cap and collar and floor pricing – the change to NPV seen under the NZE is due to Brent falling below $40/bbl and because of lower liquid prices received compared to our base case forecast. Our assets in Italy and Greece are more exposed to the effects of lower commodity prices under the scenarios considered. We are already taking steps to mitigate this impact, and are looking at longer-term, climate friendly solutions, including carbon capture solutions. Energean is a nimble operator with the ability to deliver solutions that deliver maximum value for our shareholders, and we view scenario analysis as a key tool in continuing to deliver upon this as we move into a lower-carbon world. Further information on the potential impact of commodity price assumptions and the risks associated with climate change can be found in the Group’s impairment assessment within the Financial Statements of this Annual Report on pages 190-195. Carbon price forecast Energean uses an internal price on carbon to stress-test new projects, acquisitions and investments. This allows us to measure the impact of any investment decision on the company’s carbon footprint, and to determine whether any future investments would increase our carbon intensity. Furthermore, the internal price on carbon ensures that we include the possibility of additional carbon taxation schemes being introduced which would result in a reduction of our income and valuation on individual assets. 6 Relative to Energean’s budget planning Brent oil price of $60/bbl. Page 28 of 255 ![]() STRATEGIC REPORT Our internal carbon prices for countries which do not currently have a regulated carbon tax market (e.g. outside of the EU and UK ETS regions) are: Year ($/tCO2) 2023 35 – 40 2025 34 – 50 2035 100 – 110 2050 150 – 160 This carbon price is based upon an average of the IEA’s NZE scenario in their 2022 WEO Report and the current carbon removal cost on the voluntary market, inflated at the same rate as the IEA’s NZE scenario. The internal carbon price helps mitigate future potential climate change impacts by helping us safeguard the value of future investments under different scenarios where the cost of emitting GHG increases as a result of more stringent regulated trading schemes. In our sensitivity analysis, we have seen that climate change constitutes a significant risk (albeit with a low probability) in this respect. Engineering solutions have been incorporated in the design of future projects and in operational performance improvements to emissions, in addition to considerations around carbon capture and offsetting projects in the medium term. We have already pivoted our portfolio predominantly toward gas as part of an overall strategic decision to more strongly position the company to meet global energy needs in a carbon-constrained world. We use carbon prices in our asset impairment tests and in the annual Competent Person’s Report (“ CPR ”) (an independent appraisal of our oil and gas assets). The lack of net-zero-aligned global and national policies and frameworks increases the uncertainty around how carbon pricing and other regulatory mechanisms will be implemented in the future. This makes it harder to determine the appropriate assumptions to be taken into account in our financial planning and investment decision processes. Risk Management: Disclose how the organisation identifies, assesses, and manages climate-related risks As discussed above, Energean considers climate change and GHG emissions a material risk factor. Energean first recognised climate change as a rapidly emerging risk in 2019. Climate change related risks and opportunities are fully integrated with Energean’s multi-disciplinary, Group-wide risk management process. The risk management framework ensures effective identification, assessment, control and monitoring of climate change-related risks against their potential financial, legal, physical, market and reputational impact, and further ensures that key strategic and commercial decisions are assessed by reference to their financial importance. Energean monitors the risks associated with physical and transition-related risks to ensure these are being managed within our overall risk appetite over different time horizons. Please refer to the Risk Management section between pages 74-91 of this Annual Report for further information. Metrics and Targets: Disclose the metrics and targets used to assess and manage relevant climate- related risks and opportunities where such information is material a. Disclose the metrics used by the organisation to assess climate-related risks and opportunities in line with its strategy and risk management process The key metric we used to track our progress against our energy transition strategy to be Net Zero by 2050 is the carbon intensity of our portfolio across scope 1 and 2 emissions, on an equity-share basis. Executive remuneration is partly linked to sustainability metrics, which includes emission reductions, which is one of the Group’s KPIs. Please refer to pages 127-14 7 in the Corporate Governance section for further detail. Page 29 of 255 ![]() STRATEGIC REPORT Energean’s net-zero plan Figure 4. Climate change plan 7 Energean intends to reach net-zero by 2050 (scope 1 and 2 emissions) via the following steps: 1. Increase percentage of gas in portfolio (short-term plan). a. This has already been achieved, with our production being 75% gas weighted in 2022 (versus 0% in our baseline year of 2019) 2. Asset performance optimisation a. Zero-routine flaring implemented at all operated sites b. Renewable-sourced electricity used at all operated sites c. Continued investment in methane emissions monitoring and reduction and encourage our JVs to engage in this target d. Investment in technical solutions such as energy efficiency management and fuel replacement to reduce absolute emissions 3. Natural-Based Solution (“ NBS ”) Projects a. Invest in NBS projects to generate or purchase carbon removals for less than 50% of the total projected carbon emissions of our equity share production. Our carbon removals portfolio is expected to involve a mixture of NBS technologies, such as forestry, soil, blue carbon and biochar etc. 4. Carbon Capture & Storage and Eco-Hydrogen a. Investment in CCS projects to inject emissions from ourselves and others i. Our Prinos CCS project in Greece is the most advanced. We have also signed an MOU with Shell in Egypt and exploring other CCS projects across the portfolio b. Evaluate and invest in Eco-Hydrogen projects 7 2019 is pre-Edison acquisition inclusion. 2020 pro forma emissions intensity are presented as if Edison E&P results were consolidated for the entire year, as the locked box date of the transaction was 1 January 2019. Page 30 of 255 ![]() STRATEGIC REPORT Short-term plan Our short-term plan, which extends to 2025, to reduce the Group’s absolute scope 1 and 2 emissions, includes: increased efficiency of production installations by optimising performance and replacing fuel sources, using low or zero carbon electricity and re-focusing our production mix from oil to gas. We are also evaluating opportunities to invest in natural based solution (“ NBS ”) projects, which are defined as actions to protect, sustainably manage, and restore natural or modified ecosystems that address societal challenges effectively and adaptively, simultaneously providing human well-being and biodiversity benefits by the International Union for Conservation of Nature. Examples of projects include reforestation. 2022 progress on reaching our emission reduction targets • In 2022, we reduced our equity share carbon emissions intensity to 16.0 kgCO2e/boe, a 13% reduction y-o-y. • In 2022, 75% of our working interest production was gas, up from 72% in 2021 and up from 0% in 2019 (Energean standalone) • All operated sites (which require electricity) purchase electricity generated by renewables. As a result, our absolute scope 2 emissions from our operated sites reduced by 79% in 2022 versus 2021. • In 2022, we performed three methane emissions detection campaigns at major sites in Italy. The results found minimal amounts of fugitive emissions, requiring minimal corrective actions for one asset, and no further action in the other two Medium to long-term plan Following these initial actions, we will maintain and intensify our efforts towards reducing carbon emissions. Remaining emissions will be balanced with an equivalent amount sequestered or offset, or through buying enough carbon credits to make up the difference. Energean is currently working on various projects, including Carbon Capture and Storage (“ CCS ”) opportunities across its portfolio. CCS Progress At Energean, we believe there is considerable opportunity to employ efficient CCS technologies in the regions we operate. Besides capacity from our own assets, we believe that there will also be external interest, e.g. from power plants, in providing their produced CO2 to be stored in our company’s depleted reservoirs. Energean is a highly experienced offshore operator and developer, and thus is well placed to realise such projects. In 2022, we completed pre-FEED activities at our Prinos CCS project in Greece, the results of which are currently being analysed. The Greek Government also awarded Energean a CO2 Storage Exploration Licence in 2022 which enables Energean to proceed with FEED activities. In February 2023, Energean Egypt signed a memorandum of understanding (“ MoU ”) with Shell Egypt to explore a mutually beneficial decarbonisation solution. The proposed partnership is addressing a major CCS feasibility challenge, which is the ability to connect sizeable carbon emitters to an adequate geological structure. The study will focus on the decarbonisation of the LNG terminal in Idku operated by Shell through capturing and storing the carbon dioxide in a depleted reservoir in the Abu Qir offshore concession operated by Energean. Future development stages will permit such facility to take emissions from other industrial emitters (e.g. fertilisers). Recognitions of our climate change strategy Energean continued its participation in the Climate Disclosure Project in 2022, in which we promoted disclosure transparency and further developed our climate change initiatives. The climate change rating assesses the level of detail and comprehensiveness of the content, as well as the company’s awareness of climate change issues, management methods and progress towards action taken on climate change. The supplier engagement rating assesses performance on governance, targets, scope 3 emissions, and value chain engagement. We were awarded an improved score of A- in 2022 on climate change (up from B in 2021 and B- in 2020) based on our strategy and set targets. Page 31 of 255 ![]() STRATEGIC REPORT b. Disclose Scope 1, Scope 2, and, if appropriate, Scope 3 greenhouse gas (GHG) emissions, and the related risks Emissions Intensity (Equity Share)\* 2022 2021 Pro forma 2020 8 2020 Target 2035 Target 2050 Scope 1 (kgCO2e/ boe) 15.9 18.3 19.5 37.7 Reduce scope 1 & 2 by 2035 to 2-4 kgCO2e/boe 0 Scope 2 (kgCO2e/ boe) 0.1 0.1 0.3 0.2 0 Scope 1 and 2 (kgCO2e/boe) 16.0 18.4 19.8 37.9 0 Scope 3 (Operated share, kgCO2e) \*\* 1,889,018 1,488,772 1,488,772 No target No target \* Methodologies used to calculate scope 1 emissions include the standards and protocols of EU ETS, IPCC, Concawe and EPA. Scope 2 emissions were calculated using the GHG protocol standards. \*\* To be disclosed in the 2023 CDP climate change questionnaire For further detail on our GHG emissions, please refer to the table in the ‘Our environment, our highest commitment’ section between pages 65-66 in this Annual Report. c. Describe the targets used by the organisation to manage climate-related risks and opportunities and performance against targets Energean is committed to be Net Zero by 2050 across its absolute scope 1 and scope 2 emissions on an equity share basis. In 2019, we pledged to reduce the carbon intensity of our business by 85% by 2023 (from the 2019 base year). We are on track to meet this, as we expect our 2023 emissions intensity to be between 7-9 kgCO2e/boe in 2023, primarily driven by the start-up Karish which has a low carbon intensity of between 4-5 kgCO2e/boe. We also have a 2035 target to reduce our emissions intensity to 2-4 kgCO2e/ boe. These targets are continuously monitored by our HSE Director as well as the CEO and the Board. 8 Reserves are pro forma Energean + Edison plus the acquisition of Kerogen’s 30% holding in Energean Israel Limited (“ EISL ”). The transaction closed on 25 February 2021. Page 32 of 255 ![]() STRATEGIC REPORT #### Market Overview Brent oil price In the first half of 2022, oil prices rose significantly due to Russia’s invasion of Ukraine. This increased supply concerns, which were already elevated because of low global crude oil inventories following withdrawals to meet rising demand after pandemic-related restrictions eased. In the second half of 2022, oil prices generally decreased amidst rising concerns about a possible recession. Brent averaged $99.0/bbl in 2022, a 40% increase from 2021 levels. Brent varied significantly from a daily low of $76.1/bbl in September 2022 to a high of $128.0/bbl in March 2022. Our liquids production in Israel, Italy, Egypt and the UK is Brent-linked. Focus on gas Over 75% of our production is from gas fields. Gas prices from production in Italy, the UK and Croatia are linked to the European gas market. Our contracts in Israel have fixed long-term floor prices. In Egypt, gas prices are linked to Brent but include cap and collar pricing, with fixed prices between $40 and $75/bbl. European gas prices European gas prices were highly volatile in 2022, with the Italian PSV reaching daily highs of €309.0/ MWh in August 2022 and lows of €23.5/MWh in November 2022. The average PSV price in 2022 was €125.0/MWh. Cuts in Russian gas supply to Europe, combined with falling domestic supply, hot summer temperatures and poor renewable-energy generation, caused gas prices to jump in the first 9-months of the year. Gas prices subsequently fell due to unseasonably warm weather and high gas storage levels. Israel Gas In 2022, Israel’s third gas field, Karish, commenced production in October 2022, following Leviathan (first gas in December 2019) and Tamar (2013). Tamar produced 10.1 Bcm in 2022 and Leviathan produced approximately 11Bcm (based upon 8.5 bcm reported between Q1-Q3 2022). Of this, Tamar exported 8.7 Bcm to Egypt. Leviathan, between Q1-Q3 2022, exported 5.6 Bcm (3.6 Bcm to Egypt and 2.0 Bcm to Jordan). 9 Since 2018, the Ministry of Energy has focused its efforts on transitioning to greener sources of energy through the increased use of gas and renewables, while phasing out coal. The Israeli government aims to convert all coal powered stations in the country to gas by 2025 and is targeting a fuel mix of 70% gas and 30% renewable energy by 2030. In 2022, demand for gas in Israel was approximately 12.7 Bcm. Israel’s long-term gas demand outlook remains robust, with demand forecast to grow to 17.0 Bcm by 2025 and approximately 21.5 Bcm by 2035. 10 Natural gas demand increase is driven by the enduring growth in electricity demand, as well as by a transition of fuel mix, from coal and oil to natural gas and renewables. Liquids Karish, Karish North and Tanin contain total 2P liquids reserves of 95.6 MMboe (as of year-end 2022 CPR). The Energean Power FPSO has onboard storage facilities that can store up to 800,000 barrels of liquid. The hydrocarbon liquids are exported via tankers to international markets. In October 2022, Energean signed a sale and purchase agreement with Vitol for the marketing of a number of cargoes of Karish blend hydrocarbon liquids. The first shipment of crude was offloaded in February 2023. Energean expects, based on analysis of individual well test samples, that the Karish blend trades at a similar price point to Asgard blend, given the similarity in their characteristics. The realised price is market price less certain freight, logistics and marketing costs. 9 Tamar data from Isramco Negev 2 LP’s 2022 report, Leviathan data from NewMed Energy’s Q3 2022 presentation 10 Page 33 of 255 BDO March 2023 report ![]() STRATEGIC REPORT Egypt Egypt’s gas market has seen substantial change over the past two decades, owing to several large domestic discoveries, headlined by Eni’s super-giant Zohr field in 2015. Zohr reached first gas in 2017, enabling the country to move from being a net importer to net exporter of gas. Egypt also started importing gas from Israel in January 2020, realising its ambitions to become a regional gas hub. However, a lack of a major discovery between 2016-2021, combined with rising gas demand (63.1 Bcm in 2020 rising to 71.5 Bcm in 2025 and 78.8 Bcm in 2030) 11 will result in Egypt becoming a net importer of gas early this decade. In January 2023, Chevron and Eni announced that they had discovered 3.5 tcf (c. 100 bcm) with their Nargis-1 exploration well, located offshore Egypt. Even if this discovery is developed, Egypt still requires more discoveries to be made to meet both its domestic demand growth and its pledge to become a regional energy hub 12 . Energean has a MOU with EGAS for the sale and purchase of up to 3 Bcm/yr of natural gas on average for a period of 10 years, commencing with initial volumes of up to 1 Bcm/yr. There are existing export pipelines from Israel to Egypt that Energean could utilise. 11 BDO March 2023 report 12 Welligence – Chevron hits major gas discovery offshore Egypt – what happens next? January 2023 Page 34 of 255 ![]() STRATEGIC REPORT #### Our Key Performance Indicators We measure performance over a range of key operational, commercial, financial and non-financial metrics to ensure the sustainable management of our long-term success. This keeps us focused on our strategic objectives, whilst allowing us to remain agile and responsive to external events. Energean completed the acquisition of Edison E&P on 17 December 2020, and in doing so, reinforced its commitment to the Mediterranean region. The economic reference date of the transaction was 1 January 2019 and all results subsequent to this date accrue to Energean. However, for accounting purposes, the figures for Edison E&P are only consolidated into the financial statements subsequent to the completion date; all results between the economic reference date and the completion date are reflected through a series of completion adjustments and are incorporated in the net consideration. Throughout the Key Performance Indicators section, both 2020 operational and financial results are presented on an actual and pro forma (Energean plus Edison E&P) basis. Operational We continued our strong track record of growing reserves and resources with a 20% y-o-y increase vs 2021, while production performance was 41.2 kboepd (75% gas) in 2022. 1. Working Interest Production Working Interest Production 2022 2021 Pro forma 2020 2020 kboepd 41.2 41.0 48.3 3.6 Objective: Energean is focused on maximising production from its existing asset base and delivering net production of at least 200 kboepd from its gas-weighted portfolio in H2 2024. 2022 progress: • Average working interest production of approximately 41.2 kboepd in 2022 • First gas achieved at Karish on 26 October 2022 • NEA/NI brought onstream in March 2023; three further development projects (Karish North, Cassiopea and Epsilon) progressed and expected onstream end-2023, 2024 and 2024 2. 2P Reserves and 2C Resources 2P Reserves 2022 2021 Pro forma 2020 13 2020 MMboe 1,161 965 982 762 2C Reserves 2022 2021 Pro forma 2020 13 2020 MMboe 217 188 158 158 Objective: Energean aims to replace the reserves it has produced and grow its reserve and resource base through a combination of successful exploration and appraisal and selective value accretive acquisitions. 2022 progress: • 19% year-on-year increase in 2P + 2C reserves and resources to approximately 1,378 MMboe, 77% gas, driven primarily by the Athena, Zeus, Hermes and Hercules discoveries as part of the 2022 Israel growth drilling campaign • In 2022, 15 MMboe was produced and 210 MMboe was added to 2P reserves, which equates to a reserve replacement ratio of +1400% 13 Reserves are pro forma Energean + Edison plus the acquisition of Kerogen’s 30% holding in Energean Israel Limited (“ EISL ”). The transaction closed on 25 February 2021. Page 35 of 255 ![]() STRATEGIC REPORT Financial Energean is focused on increasing production from its large-scale, gas-focused portfolio to deliver material free cash and maximise total shareholder return. 1. Revenues Sales Revenues 2022 2021 Pro forma 2020 2020 $ million 737.1 497 .0 335.9 28.0 Objective: Energean’s near-term target is to generate revenues in excess of $2.5 billion per annum. With approximately 1,161 million boe of 2P reserves to be monetised and a revenue growth profile underpinned by gas sold under largely fixed price contracts, we at Energean believe this target is both achievable and sustainable. 2022 progress: • 2022 revenues of $737.1 million • 2022 revenue was higher than 2021 primarily because of higher realised commodity prices • Abu Qir Production Sharing Contract (“ PSC ”) amendment increased the gas sales price from November 2022, resulting in higher revenues 2. Cost of Production 14 Cost of Production 2022 2021 Pro forma 2020 2020 $/boe 18.9 17.5 11.3 21.4 Objective: Following completion of the Edison E&P acquisition Energean has started to implement programmes to further the reduction of operating costs with the aim of creating a sustainable low-cost business. The Group’s near-term cost of production (operating costs plus all royalties) target is $9-11/ boe. 2022 progress: • The increase in cash unit production cost was primarily driven by increased royalties paid in Italy and increased energy costs across the group 3. Adjusted EBITDAX 15 Adjusted EBITDAX 2022 2021 Pro forma 2020 2020 $ million 421.6 212.1 107.7 (8.3) Objective : Energean aims to maximise EBITDAX to maintain the profitability of the business. The Group expects to grow EBITDAX to $1.75 billion per annum in the short-term through the successful delivery of sanctioned key growth projects. 2022 progress: • 2022 adjusted EBITDAX was higher than 2021 because of higher revenue partially offset by higher operating costs from the enlarged group 4. Cash Flow from Operating Activities Cash Flow from Operating Activities 2022 2021 Pro forma 2020 2020 $ million 272.2 132.5 137.0 1.5 • The increase was primarily driven by higher realised commodity prices versus 2021 14 The Group uses certain measures of performance that are not specifically defined under IFRS or other generally accepted accounting principles. These non-IFRS measures include Cost of Production. More information can be found in the Financial Review section, under the heading ‘Non-IFRS measures’. 15 The Group uses certain measures of performance that are not specifically defined under IFRS or other generally accepted accounting principles. These non-IFRS measures include adjusted EBITDAX. More information can be found in the Financial Review section, under the heading ‘Non-IFRS measures’. Page 36 of 255 ![]() STRATEGIC REPORT 5. (Loss)/Profit After Tax Profit After Tax 2022 2021 Pro forma 2020 2020 $ million 17.3 (96.2) (416.4) (92.9) • The increase was primarily driven by higher realised commodity prices versus 2021, partially offset through the windfall taxes in Italy Net-zero carbon emissions Energean’s aim is to lead the energy transition in the eastern Mediterranean through a strategic focus on gas and achieve its net-zero ambition by 2050. 1. Carbon Intensity Reduction Carbon Intensity on equity share\* 2022 2021 Pro forma 2020 2020 KgCO2e/boe (Scope 1 and 2) 16.0 18.3 19.8 37.9 \*Methodologies used to calculate scope 1 emissions include the standards and protocols of EU ETS, IPCC, Concawe and EPA. Scope 2 emissions were calculated using the GHG protocol standards. Objective: In 2019, we were the first E&P company in the world to commit to net-zero emissions by 2050. As part of this commitment, we pledged to reduce by the carbon intensity of our business, by 85% by 2023, versus our 2019 base year 16 . Energean used internationally recognised standards and guidance to calculate its GHG emissions. We followed the recommendations of the Greenhouse Gas Protocol, as well as guidance from IPIECA, the UK’s Department for Environment, Food and Rural Affairs (DEFRA), the International Energy Agency (IEA), the UN Intergovernmental Panel on Climate Change (IPCC) and the EU Emission Trading System. Our scope 1 emissions under the EU ETS have been verified by TUV Austria Hellas. 2022 progress: • We delivered a 13% year-on-year reduction in the carbon intensity of our operations to 16.0 kgCO2e/ boe on equity share basis HSE Energean is fully committed to behaving responsibly and conducting its business with integrity in everything it does. 1. Lost Time Injury Frequency Rate LTI Frequency Rate 2022 2021 Pro forma 2020 2020 No. per million hours worked 17 0.47 0.33 0.63 0.65 Objective: Energean is committed to managing its operations in a safe and reliable manner to prevent major accidents and to provide a high level of protection to its employees and contractors. Our target is to keep the LTIF Rate below 0.50. 2022 progress: • Safe and reliable operations, zero serious injuries • Zero environmental damage and zero oil spills • Zero health damage and occupational illnesses 16 Scope 1 and 2 emissions. 17 Refers to employees and contractors. Page 37 of 255 ![]() STRATEGIC REPORT Total shareholder return In September 2022, Energean declared its maiden quarterly dividend, aligned with its commitment to return an initial $50 million to shareholders per quarter no later than the end of 2022. In total, Energean returned US$0.60/share to shareholders (approximately $106 million) in 2022, representing two-quarters of dividend payments. In 2023, Energean intends to continue to pay quarterly dividends to its shareholders in line with its previously communicated dividend policy, which includes: • Targeting to pay cumulative dividends of at least $1 billion by the end of 2025 • • This is underpinned by predictable cashflows, largely insulated from commodity price fluctuation, thanks to long-term gas contracts with floor-price protection and high take-or-pay provisions • Paying a dividend of at least $50 million per quarter. The amount will ramp-up in line with Energean’s near-term production and revenue targets to at least $100 million per quarter, as the Company’s developments come onstream during the next 18 months • The Board and Management will regularly review its capital allocation to ensure that sufficient liquidity remains within the Group, to continue Energean’s organic growth strategy and consider the potential for opportunistic M&A and/or supplementary capital returns to shareholders. • Energean is targeting to reduce net debt/EBITDAX on a Group consolidated basis to levels below 1.5x and sees this being met no later than 2024 • Post 2025, Energean targets maintenance of a progressive dividend policy, in line with its focus on maximising total shareholder returns Page 38 of 255 ![]() STRATEGIC REPORT #### Review of Operations Production Group working interest production averaged 41.2 kboepd in 2022 (2021: 41.0 kboepd ). 2022 production was higher than 2021 because of the start-up of production from Karish on 26 October 2022. Working interest hydrocarbon production (kboepd) 2022 2021 Israel 5.4 (92% gas) N/A Egypt 25.1 (87% gas) 29.1 (87% gas) Rest of portfolio 10.7 (40% gas) 11.9 (36% gas) Total 41.2 (75% gas) 41.0 (72% gas) Israel Karish Production commenced at Karish on 26 October 2022, marking a pivotal milestone for Energean. All three wells (Karish Main-01, 02 and 03) had been opened before year end. Data collected from the wells has demonstrated the reservoir’s ability to produce in line with expectations. Sales gas between 26 October 2022 and 31 December 2022 totalled 0.28 bcm. Notwithstanding the excellent reservoir deliverability, this was lower than projected as a result of the project being in the commissioning phase, during which variability in production is higher than in the post-commissioning phase. Further to the progress of commissioning activities on the Karish Field and the Energean Power FPSO, Energean is, at the time of writing, now sequentially notifying gas buyers that the commissioning period under the GSPAs has ended and the start date for commercial obligations has commenced. Energean expects to have completed this process for all gas buyers by the end of March 2023. The history of Karish In 2016, Energean acquired the Karish and Tanin licences from NewMed Energy (formerly Delek Drilling) and in March 2018, Energean took FID on Karish. An EPCIC contract was then signed with Technip to build the Energean Power FPSO. First steel was cut in China in November 2018 and in April 2020 the hull arrived in Singapore for the integration of the topsides. The Covid pandemic lead to shut-downs in the yard, which impacted the timely completion and sail-away of the FPSO, which occurred in April 2022. The FPSO then arrived in Israeli waters in June 2022, following which the hook-up of the wells and commissioning process occurred prior to first gas. Karish North In January 2021, Energean reached FID at the 1.2 Tcf (34 Bcm) Karish North field, 21-months after the announcement of the discovery. The field is being commercialised via a low-cost tie-back to the Energean Power FPSO, which is situated approximately 5 kilometres away. The Karish North development well was successfully drilled as part of the 2022 growth drilling campaign. Key upcoming activities ahead of Karish North first gas include installation of the Karish North manifold, umbilical and spool, ahead of opening of the well before year-end 2023. The production capacity from the first well is expected to be up to 300 MMscf/d (approximately 3 Bcm/yr). A second well is expected to be drilled in 2026 and, combined with later life workovers to both wells, is expected to be sufficient to fully develop the 256 MMboe of 2P reserves. Second Oil Train and Gas Sales Riser In May 2021, Energean took FID on two high-return growth projects. The first, a second oil train on the FPSO that will increase the liquids capacity from 18 kboepd to 32 kboepd, at minimal incremental operating costs. The second, a second gas sales riser, will enable gas production and delivery at the full 8 Bcm/yr capacity of the FPSO. Page 39 of 255 ![]() STRATEGIC REPORT Both projects made good progress in 2022, with first steel cut at the yard in Dubai in H2 2022 for the second oil train. The second export riser and the Karish North flowline were transported from the UK to Israel in March 2023. The riser will be installed shortly and will connect the production facilities on the FPSO to the pipeline-to-shore. The second oil train will be installed and commissioned in-situ, and is expected to be ready to process hydrocarbon liquids by year-end 2023. Gas and Liquids Contracts GSPAs Energean has signed gas sales agreements (“ Agreements ”) for the supply of approximately 7.4 Bcm/yr of gas on plateau. The weighted average tenor of the GSPAs is 15 years. All Agreements include provisions for floor pricing and take-or-pay and / or exclusivity, providing a high level of certainty over revenues from the Karish, Karish North and Tanin projects over the next 20 years. 2022 activities In March 2022, Energean signed a supply agreement with the Israel Electric Company (“ IEC ”), the largest natural gas consumer in Israel for Karish Gas. The gas price is determined a month ahead, with volumes determined on a daily basis. The agreement started upon the commencement of first gas production from Karish, and is valid for an initial one-year period with an option to extend subject to ratification by both parties. In May 2022, Energean signed a new GSPA, representing up to 0.8 bcm/yr, to supply gas to the East Hagit Power Plant Limited Partnership (“ EH Partnership ”), a partnership between the Edeltech Group and Shikun & Binui Energy. The GSPA is for a term of approximately 15 years, for a total contract quantity of up to 12 bcm. The contract contains provisions regarding floor pricing, offtake exclusivity and a price indexation mechanism (not Brent price linked). In July 2022, Energean Israel signed a new GSPA, representing 0.08 bcm/yr, to supply gas to Shapir-G.E.S Concessionaire IPP Ltd for the Ashdod Desalination Plant. The GSPA is for a term of 20 years starting from January 2024 and includes take-or-pay provisions and floor pricing. Liquids In October 2022, Energean signed a sale and purchase agreement with Vitol for the marketing of a number of cargoes of Karish blend hydrocarbon liquids. The first sale of Karish hydrocarbon liquids was completed in February 2023, and Energean expects Israel to contribute 15 – 18 kboepd of hydrocarbon liquids production in 2023, at an estimated one sale per month. Energean expects, based on analysis of individual well test samples, that Karish blend will trade at a similar price point to Asgard blend, given the similarity in their characteristics. The realised price will be market price less certain freight, logistics and marketing costs. Exploration In 2022, Energean drilled four exploration wells, offshore Israel. Energean’s growth drilling programme discovered and de-risked approximately 73 bcm (approximately 480 MMboe). • Athena and Zeus (part of Olympus Area) • • The Athena (May 2022) and Zeus (November 2022) wells, block 12, discovered 25 bcm (approximately 167 MMboe) of natural gas resources. D&M’s analysis determined that the proximate Hera prospect, was also sufficiently de-risked to be classified as 2P reserves. Together, these total 31 bcm of 2P reserves. This, in turn, substantially de-risked a further 37 bcm (approximately 243 MMboe) of prospective resources across the Olympus Area in nearby prospects that have equivalent geological properties and seismic attributes. • Hermes (part of Arcadia Area) • • Following post-well studies, recoverable resources in the Hermes discovery (October 2022), block 31, are now estimated to be approximately 5 bcm (32 MMboe). The results from this well have provided important additional information about Orpheus and Poseidon, nearby prospects, that may be future targets of appraisal activity to firm up resource volumes within this area, which Energean has named the “Arcadia Area” Page 40 of 255 ![]() STRATEGIC REPORT • Energean is preparing notices of commerciality for both the Olympus Area and Arcadia Area, required for the conversion of those exploration licences into development leases • Hercules • • In December 2022, the Hercules well, block 23, made a discovery in the Miocene. The C and D sands are estimated to contain mean Gas Initially In Place (“ GIIP ”) of approximately 3 bcm. This excludes discovered volumes in the A and B sands (which were the subject of the upgrade to discovered Athena resource volumes in November 2022), which are currently being evaluated, and volumes will be communicated once available, along with Energean’s assessment of commerciality of the discovery. The large, deeper, liquids target in the Hercules prospect was not considered drill-ready and remains a potential target of future exploration. Egypt Production The Abu Qir gas-condensate field offshore Egypt was the largest producing asset in the Group’s portfolio in 2022. The field delivered 25.1 kboepd of working interest production in the 12 months to 31 December 2022, approximately 87% of which was gas. The NAQ-PII6 well was brought onstream in September 2022 at a rate of 26 MMscfd, which increased Q4 production versus the previous quarters. Production is expected to grow in 2023, as the remaining three NEA/NI wells are brought online. Development NEA/NI subsea tieback In January 2021, Energean sanctioned the NEA/NI project, which is in shallow-water offshore Egypt and neighbouring the Abu Qir concession. An EPCI contract for the four subsea wells and the associated tie-back to the Abu Qir NAQ PIII platform and associated infrastructure was awarded to TechnipFMC in February 2021. The NEA/NI project achieved first gas in March 2023, following the completion of the NEA6 well in January 2023. The remaining three wells are expected online throughout 2023. The project contains an estimated 39 MMboe of 2P reserves according to D&M. Peak working interest production is anticipated to be around 15 kboepd. Abu Qir infill drilling programme Energean expects to drill an additional four wells on the Abu Qir licence in 2024. Exploration North East Hap’y Offshore Energean expects to participate in an exploration well targeting the Orion prospect (W.I. 30%) along with its partner IEOC (ENI; 70%; operator) on the North East Hap’y block, offshore Egypt, in 2023. Energean expects to farm down 12% of its interest to 18% in the North East Hap’y block ahead of spudding the well. East Bir El-Nus concession (Block-8) On 3 January 2022, an international consortium led by Energean Egypt (50% operator and Croatia’s INA, d.d. 50%) was awarded an exploration licence for the East Bir El-Nus concession (Block-8), in the Western Desert of Egypt. The award is in line with Energean’s strategy to increase and diversify its presence in Egypt and reinforces its commitment to the country. The work programme for the licence includes a 180 linear km 2D seismic survey, a 200km2 3D seismic survey plus two exploration wells, which are expected to target estimated resources (in place) of approximately 100 MMboe. Page 41 of 255 ![]() STRATEGIC REPORT Europe Production Working interest production from the Group’s European portfolio averaged 10.7 kboepd (40% gas) in 2022. Italy – Cassiopea development The Cassiopea project (180 Bcf 2P reserves), in which Energean has a 40% non-operated equity stake, remains on track for 2024. The field will deliver plateau working interest production rates of approximately 10 kboepd (100% gas) from the middle of the decade, providing more than 30% of the region’s gas consumption. Onshore work is progressing well and offshore installation activities are expected to begin in Q2 2023. The operator expects to start drilling activities in the summer 2023, which includes two new wells and two recompletions. Upside exists within the surrounding area from potential satellite tie-back options, including the Gemini and Centauro prospects, which Energean expects to participate it, with its partner ENI, in 2024. Greece – Epsilon Development Energean’s Epsilon project involves three wells (which were pre-drilled in 2019 and require completion) from the new-build Lamda platform, which will be tied-back to the existing Prinos complex. First oil from the Epsilon development, which has 2P reserves of 23.6 MMboe in aggregate, is expected in 2024. The installation of the platform jacket at the field is expected to take place in Q2 2023. Croatia – Irena Development Energean is currently in FEED for the development of the Irena gas field. Energean expects to take FID for the project in 2023. If progressed, first gas is anticipated for Q4 2024. The field has 2P reserves of 13.3 Bcf (2.3 MMboe). Exploration Croatia Energean (30%) expects, alongside operator EdINA, to drill the Izabela-9 exploration well, offshore Croatia, in Q2/Q3 2023. This well is being drilled into the northern segment of the Izabela SE prospect, which has gross unrisked P50 GIIP of 0.49 Bcm. Greece Energean holds a 75% stake in Block 2, located offshore western Greece. Hellenic Petroleum holds the remaining 25%. A 3D seismic campaign was completed in November 2022. The results of this is currently being processed and analysed to determine next steps. Energean also holds a 100% stake in the Ioannina licence, located onshore Greece. A drill or drop decision will be taken in 2023. UK In December 2022, the Isabella appraisal well encountered hydrocarbons in the targeted reservoir. The operator has completed the gathering of data and has plugged and abandoned the well. The operator intends to evaluate the drilling results to establish the commerciality of the reservoir. Carbon Capture and Storage Projects Energean is committed to meeting its net-zero emissions target by 2050 and leading the Mediterranean region’s energy transition. The Prinos CCS (Greece) project proposal is to provide long-term storage for carbon dioxide emissions captured from both local and more remote emitters. Energean estimates that the Prinos subsurface volumes are sufficient to sequester up to 100 million tonnes of CO2, representing up to around 50% of total annual emissions from the Greek manufacturing sector for 20 years. In September 2022, Energean was awarded a CCUS exploration licence from the Greek government. The results of the pre-FEED with Wood Group and the subsurface studies with Halliburton are currently being assessed. Page 42 of 255 ![]() STRATEGIC REPORT Reserves Energean’s year-end 2022 working interest reserves 18 are 1,161 MMboe, a 19% increase versus 2021. The increase in reserves versus 2021 was primarily due to the Olympus Area discoveries, offshore Israel. At 1 January 2021 19 Revisions Discoveries Acquisitions/ (Disposals) Transfers from / (to) contingent Production At 31 December 2022 Israel Oil MMbbls 101 0 5 – (6) (0) 101 Gas Bcf 3,537 47 1,105 – (56) (10) 4,624 Total MMboe 744 8 206 – (16) (2) 940 Greece Oil MMbbls 36 (12) – – 14 – 38 Gas Bcf 6 (5) – – 4 – 5 Total MMboe 37 (13) – – 15 – 39 Egypt Oil MMbbls 13 0 – – 0 (1) 13 Gas Bcf 508 12 – – 15 (45) 490 Total MMboe 103 2 – – 3 (9) 99 Italy Oil MMbbls 35 3 – – – (2) 36 Gas Bcf 248 2 – – – (8) 242 Total MMboe 78 3 – – – (3) 78 United Kingdom Oil MMbbls 1 0 – – 0 (0) 2 Gas Bcf 1 (2) – – 3 (0) 2 Total MMboe 1 0 – – 1 (0) 2 Croatia Oil MMbbls – – – – – – – Gas Bcf 14 (0) – – – (0) 14 Total MMboe 2 (0) – – – (0) 2 18 YE22 D&M and NSAI CPR. 19 Pro forma Energean (includes Edison) plus the acquisition of Kerogen’s 30% holding in EISL. Page 43 of 255 ![]() STRATEGIC REPORT At 1 January 2021 19 Revisions Discoveries Acquisitions/ (Disposals) Transfers from / (to) contingent Production At 31 December 2022 Total 20 Oil MMbbls 187 (8) 5 – 9 (4) 189 Gas Bcf 4,315 55 1,105 – (34) (64) 5,376 Total MMboe 965 1 206 – 3 (15) 1,161 Present Value of 2P Reserves 21 ($ million) 7,357 Adjusted TopCo 22 Group Net Debt YE22 ($ million) 107.3 20 Numbers may not sum due to rounding 21 YE22 NSAI and D&M CPR’s High Case (based on forward curve), NPV10 22 The Group excluding Israel and Greece. Page 44 of 255 ![]() STRATEGIC REPORT #### Corporate Social Responsibility Our approach At Energean, we are strongly committed to creating shared value for our stakeholders and local communities. Guided by our Ethos and international best practices, we implement a variety of corporate social responsibility (CSR) activities aiming to protect the environment and improve the quality of life of those around us. In what follows, we provide some important insights on the measures we are taking: • We have committed to achieve Net Zero emissions by 2050 (we were the first E&P to set this target) and are further planning to set science-based targets (SBTi) • We publish an annual Sustainability Report that is in accordance with the Global Reporting Initiative (GRI) Standards and the guidelines of the Sustainability Accounting Standards Board (SASB) for oil and gas E&P companies • We implement initiatives that contribute to achieving the entire spectrum of the United Nations’ Sustainable Development Goals (UN SDGs) • We participate in the Carbon Disclosure Project (CDP) in the categories of Climate Change and Supplier Engagement, achieving exceptional ratings that exceed the industry average • We align our disclosures with the reporting recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD) and present our approach within our Annual and Sustainability Reports • We are an active signatory to the United Nations Global Compact (UNGC), committed to adhering to its principles on human rights, labour, environmental and anti-corruption issues • We engage with prominent ESG ratings such as the Sustainalytics and the Maala Index as well as voluntary initiatives such as the Terra Carta – the Sustainable Markets Initiative of King Charles III, the former Prince of Wales Our people are at the forefront of Energean’s success. Operating in numerous countries, we acknowledge that it is essential to bring our people together and unite diverse cultures. To this end, we design initiatives to create an inclusive and attractive workplace for our employees, with prominent examples being the “Did you know” and the “Evolve and get involved” series. At the same time, we are aware of the unsafe working conditions that may arise and therefore take a proactive approach to ensure that the health, safety and security of our employees remains a priority. As a corporate citizen, we understand that our stakeholders have certain expectations of us. We welcome these expectations and constantly strive to incorporate CSR considerations into our business planning processes. Energean’s CSR programme is designed to address the needs of our stakeholders, facilitate the formation of long-lasting relationships and provide tangible benefits to the communities in which we operate. Our CSR policy Energean’s CSR policy is based on our principles and values, which are the cornerstone of our daily actions. Our stakeholders’ expectations and priorities are embedded in the policy, enabling us to prioritise the most important sustainability aspects of our business: our people, health and safety, the environment and community relations. Our CEO, Board of Directors and Senior Management are responsible for setting, shaping and monitoring our CSR and sustainability goals and objectives. As such, they are fully aligned with our goal to lead the energy transition in the Mediterranean through a strategic focus on gas. In an effort to continuously enhance our sustainability profile, we work together with governments, the private sector and wider society to exchange views and further improve our approach. Page 45 of 255 ![]() STRATEGIC REPORT Corporate Governance is a top priority Energean adheres to the highest ethical standards, consistent with internationally recognised frameworks and industry best practices. We maintain a strong corporate governance system that enables us to accomplish our CSR objectives and fulfil our responsibilities towards our stakeholders and secure their trust. Meanwhile, we strive to increase our productivity and maintain a flexible operating model to effectively adapt to any changes in the macroeconomic environment. We build on best practices and continuously strengthen our governance and internal control functions to maintain and improve our efficiency and transparency. Equality and transparency Energean adopts business practices characterised by professionalism, fairness and transparency. Guided by our Code of Ethics, we demonstrate to all our employees and stakeholders how important compliance with laws and regulations is to us. The Code explicitly states our zero-tolerance approach towards any form of bribery, corruption and other forms of financial crime and this position is strongly reinforced by Energean’s Management and Board. Furthermore, the Code of Ethics underpins our stance on human rights, lobbying and advocacy, the prevention of the facilitation of tax evasion, anti-slavery and the General Data Protection Regulation. We ensure that all our business partners and those acting on our behalf, are in line with our Code of Ethics and comply with the applicable ethics and compliance clauses in their contracts. In addition, before entering into any partnership, we follow a risk-based third-party due diligence approach to manage risks related to ownership structure, anti-bribery and corruption, sanctions, trade restrictions, human rights and labour conditions. Bribery and corruption It is crucial for us to act and operate ethically and honestly. Energean complies with all laws and regulations relating to bribery and corruption that apply in all countries in which we operate, including the U.K. Bribery Act 2010. We show zero tolerance towards any incidents of bribery and corruption as covered by our Anti-Corruption and Bribery Policy, and frequently engage with our employees and business partners to maintain our integrity. We also implement an anti-bribery and anti-corruption compliance programme, overseen by the Board of Directors, to identify and mitigate related risks that could lead to ethical misconduct. Our contribution to the 17 United Nations’ Sustainable Development Goals We recognise that as an energy company we have an obligation to contribute to the United Nations 17 Sustainable Development Goals (SDGs). For this reason, we link our actions and initiatives to these goals. The following table displays Energean’s main CSR activities in 2022 and the respective SDGs they serve. SDGs Our commitments and actions • “Back to School” with Energean • Greece – we donated school supplies and stationery equipment to three social institutions, two community centres and one kindergarten, supporting over 400 students and their families in need – Kavala, Island of Thassos, Zitsa (Ioannina) • Italy – in collaboration with “Caritas” (a Catholic organisation for charity) and with the support of our colleagues, we donated school supplies, backpacks, and stationery equipment, helping schools, an Aid Center, and families in need & their children – Sambuceto, Vasto, Siracusa, Pozzallo, Milan • Egypt – we supported the “FLDO Foundation” (an NGO that empowers female employment), by ordering 300 school bags manufactured with recycled materials. The bags were donated to underprivileged students of two villages. Also, along with the company’s employees, we donated the tuition fees to all primary school students in need of those same two villages – Villages of Zirzarah and Maadeyah Page 46 of 255 ![]() STRATEGIC REPORT • Israel – in collaboration with “Yeladim – Fair Chance for Children” (an NGO which takes care of children that were transferred from broken homes by welfare authorities and now live in boarding schools), we opened the new school year by donating school bags and stationery equipment to 300 children living in four welfare boarding schools – Haifa, Carmel • Supported the “14th International Diplomatic Charity Christmas Bazaar”, in collaboration with the Embassy of Greece, raising funds for a Neonatology Clinic and two Primary Schools – Podgorica / Montenegro. • Donated to the Holy Metropolis of Philippi, Neapolis and Thasos, for the support of the Central Welfare Fund and the “Meal of Love” (the daily soup kitchen performed by the 95 parish churches of the Holy Metropolis) – Kavala / Greece. • Energean teamed up with the Greek Embassy of Montenegro and donated valuable food packages to the donation campaign of the NGO “Women of Bar” – City of Bar / Montenegro. • Donated 152 Christmas supermarket vouchers to families in need, supporting the Social Market in the Municipality of Zitsa – Ioannina, Greece. • Continued our excellent HSE performance with almost 1 million man-hours with no Lost Time Injuries regarding all Energean employees. • Maintained the ISO 45001 Health and Safety Management System certificates in all our operated sites and established it in Prinos in order to be certified in 2022. • Participated in a Relay Marathon in support of cancer research. The event was in support of LILT, the National Association for the Research Against Cancer – Milan / Italy. • Donated a Chest Compression System (a cardiopulmonary resuscitation machine) to the Health Center of Prinos, in honour of the “World Heart Day 2022” (29 September) – Island of Thassos / Greece. • During Breast Cancer Awareness Month (October), while supporting women’s health • Italy: • Donated to the National Association for the Research Against Cancer (LILT). • Organised a webinar on cancer prevention through nutrition and a healthy lifestyle. • Arranged a free check-up for the female employees & delivered a LILT leaflet and ribbon to all colleagues. • Greece: • Organised a presentation on the “Causes, Risk Factors and Prevention of Breast Cancer”, for all female employees. • Egypt: • Organised a breast cancer awareness campaign for the residents of Maadeyah village, followed by the transportation of women to the Baheya Foundation, Cairo, for routine check-ups. • Israel: • Arranged for a breast surgeon to visit the offices in Haifa and Tel-Aviv and to perform checks-up to all female employees. The service was available also to the female family members of all staff (wives, sisters, and mothers). Page 47 of 255 ![]() STRATEGIC REPORT • Offered paid internships to 24 university students around the Group • Organized an educational session addressed to primary school students, in order to introduce them to the concepts of sustainability, climate change, and biodiversity preservation – Village of Maadeyah / Egypt. • Set-up of a webinar on Ancient Greek Philosophy, titled “An anatomy of Ancient Greek Philosophy: How Philosophy leads us to success”. The webinar invited our colleagues to be enlightened and inspired physically, spiritually, and mentally, to expand our comfort zone and to improve our leadership, managerial and persuasion skills. • On 5 June (World Environment Day), Energean aligned with the United Nations’ 2022 theme “Only One Earth”, focused on positive sustainability actions, and increased environmental awareness: • Greece: • Donated waste disposal bins to the village of New Peramos – Kavala. • Organised and performed a beach clean-up at Richo Beach, in collaboration with the Municipality of Paggaion, in the villages of Nea Peramos & Nea Iraklitsa – Kavala. • Egypt: • Performed a beach clean-up in the village of Al Maadeyah, in cooperation with AQP and “GoClean”. • Distributed LED lamps to underprivileged families, in cooperation with AQP. • Distributed recycling bins to schools and the Al Maadeyah beach club. • Hosted an environmental awareness session titled “Preserve the Environment by Recycling”, encouraging our employees to form sustainable habits and raise awareness for the next generation. • Montenegro: • Donated concrete waste disposal bins to the Maljevik and Sutmore sea- side promenades, in cooperation with the Municipality of Bar. • Granted two Master’s degrees Clean Energy scholarships to students at the Technion (the Israel Institute of Technology), to reward excellence and promote academic research on clean energy – Haifa / Israel. • Developed a partnership between the public and the private sector, fostering a mutual collaboration between a university and a business, by signing two three-year agreements: i) for a PhD scholarship with the University of Insubria, regarding CO2 Underground Storage within the CCUS (Carbon Capture, Utilization & Storage) Value Chain, and ii) with the University of Bologna who assigned a PhD Researcher & Assistant Professor to integrate CCUS within Circular Economy solutions – Varese, Bologna / Italy. • Supported the USAID Scholars Activity Internship Program, implemented by the American University in Cairo. Committed to empowering young leaders through skills enhancement programs, Energean successfully provided five internships – Cairo / Egypt. • Collaborated with the San Benedetto del Tronto’s Port Authorities, Coast Guard, and Harbour Master’s Office. Along with the Montani Technical Institute in Fermo, all parties worked together for safeguarding the sea while providing real life educational opportunities to the new generations. The Institute’s students had the opportunity to learn about safety aspects in the field, and to define and manage an emergency sea protection exercise plan. Page 48 of 255 ![]() STRATEGIC REPORT • In 2022, we increased the overall percentage of women at Energean for a second year running (2022: 24%; 2021: 16%; 2020: 14%) and the number of women on the Board increased slightly from 30% to 33%. We also maintained a healthy mix of employees from different generations. • Supported, in cooperation with Dar Al Orman Association, and personally delivered supplies to five small businesses owned by women that support themselves and their families – Village of Maadeyah / Egypt. • Energean recycled 95.2% of water withdrawals at its production sites in 2022. • Installed clean water connections to the 10 homes most in need in the Beheira Governorate, by successfully partnering with Dar Al Orman Association on a project to install clean water to low-income villages – Egypt. • Energean is focused on providing cleaner and affordable energy. In 2022, Energean began production from its flagship Karish field in Israel. Gas from this field is sold into the market at lower prices than the existing producers and is helping Israel shut all its coal-powered power plants by 2050, which will remove around 3 million tonnes of CO2. • The number of employees aged 15-24 increased by 1000% y-o-y • The number of nationalities increased y-o-y: 33 as of 31 December 2022 (versus 24 as at 31 December 2021) • Supported (donation and sponsorship) the “Athletic Club of Kavala (AOK) – Department of Wheelchair Basketball”, by covering the fixed needs and expenses of the Department for the entire Wheelchair Basketball Season 2021-22 – Kavala / Greece. • Supported and ran alongside the Muscular Dystrophy Association of Greece (MDA Hellas) and patients in wheelchairs, by participating in the 5km Road Race running event of the “Athens Half-Marathon 2022” in the centre of Athens. MDA Hellas is a non-profit organisation that supports people that suffer with neuromuscular diseases – Athens / Greece. • Supported the Prefectural Association of People with Disabilities of Kavala, by financing the operation, service and maintenance of a special vehicle/van that transports their members daily – Kavala / Greece. • Continued the support to “Etgarim” for the fourth year, an NGO dedicated to the empowerment and social integration of people with disabilities through outdoor sports. For a second year in a row, Energean colleagues ran 5 and 8 kilometres in Etgarim’s “Spring Run” delivering a message of inclusivity – Israel. • Donated to “IdeaVita”, an organisation with the aim of designing and implementing independent life paths to people with disabilities, affirming and guaranteeing their right to a full and independent life over time. Along with the donation, we organized an internal workshop for our employees on the power to go beyond one’s limits – Milan / Italy. • Supported and ran alongside the Muscular Dystrophy Association of Greece (MDA Hellas) and patients in wheelchairs, by participating in the 39th Athens Classic Marathon events for 2022 (5K & 10K Races), with our CEO, Mathios Rigas, leading our company’s running team in the center of Athens (November 2022). This year, Energean had 12 employees-runners participating in “The Authentic” 42K Classic Marathon Race and supporting MDA Hellas, coming from Greece and 3 more countries. MDA Hellas is a non-profit organisation that supports people that suffer with neuromuscular diseases – Athens and Marathon / Greece. Page 49 of 255 ![]() STRATEGIC REPORT • Donated to MDA Hellas for the operation of the Neuromuscular Diseases Unit of the “AHEPA” University General Hospital (“ AHEPA ” Hospital) of Thessaloniki, which will serve about 350 people in the coming year, children and adults – the Unit covers the geographical area of all Northern Greece. • Signed a new partnership with ‘Special Olympics Italia’, an organisation that promotes sport as a means of inclusion for children and adults with intellectual disabilities. Specifically, we support Francesca, a basketball athlete who will participate in the Berlin “Special Olympics World Games 2023” – Italy. • Sponsored an experiential event where the 400 elementary school students who participated were introduced to the way people with different disabilities live their lives and the everyday challenges they face. Organized by the Municipality of Kavala, the local Directorate of Secondary Education and NGOs for people with disabilities – Kavala / Greece. • Supported “Così come sei”, an association committed to responding to the need for inclusion of families with disabled children – Ragusa / Italy. • Provided financial aid to Rahaf Sailing and Surfing Club, supporting young sailors from low-income communities. Our donation helped the sailing club with their preparations for the 2024 Paris Olympics, supporting over 120 sailors and surfers from Rehaf to participate in multiple competitions – Rehaf / Israel. • Became the main sponsor of OKAK (Kavala’s Track and Field Athletic Club), for the 2022-2023 season. OKAK is one of the biggest clubs in Track and Field in the East Macedonia & Thrace Region of Greece, that promotes good sportsmanship and ethos to more than 200 young athletes in the city of Kavala, making OKAK a role model for the sporting community of the country – Kavala / Greece. • Became a sponsor of the “Aretusa” Handball Team in Siracusa, for the 2022-23 Season. “Aretusa” participates in both men’s and women’s A2 championships, and works directly with local youth and schools, especially in the most deprived areas of the city – Siracusa / Italy. • Partnered with the broader Egyptian Petroleum Sector to provide support and new houses to the victims of the terrible flood at Khor Awada village – Aswan / Egypt. • Grand Sponsor of the 6th Dodoni Festival – a summer open-air Cultural Festival in the area of Ancient Dodoni – Ioannina / Western Greece. • Grand sponsor of the 22nd “Trofeo Del Mare” (“ The Trophy of the Sea ”), the International Maritime Awards 2022, that took place in Marina di Ragusa. The awards highlight the excellent work of men, women and institutions who are committed to and passionate about the Mediterranean Sea – Sicily / Italy. • Continued the support to “Etgarim” – a Haifa Sailing Club that empowers people with disabilities and youth with special needs through outdoor sports – Israel. • Recycled 90.5% of the waste generated during 2021 in production sites. • Maintained the ISO 14001 Environmental Management System certificates in all our operated sites. • Energean’s Egyptian Abu Qir Petroleum (AQP) joint venture (JV) partners received their first certificate for waste segregation and paper recycling in Egypt. AQP becomes the first Oil & Gas JV in Egypt to entirely (100%) recycle its paper, cartons and plastic waste from all its offices and operational sites (onshore and offshore). Energean’s Cairo branch has followed the same approach of waste segregation and recycling, by cooperating with “Go Clean”, a recycling solutions company – Egypt. • Hosted a local stakeholder engagement initiative, by welcoming a delegation of 30 local journalists on board our offshore infrastructure located in the Adriatic Sea, part of the “full immersion” sessions organized by the Order of Journalists of Molise and Energean Italy. It explained how the Rospo Mare field works in full compliance with all the relevant and most recent HSE regulations – Vasto / Italy. Page 50 of 255 ![]() STRATEGIC REPORT • Energean continuously pursues its pledge to become a net-zero emitter by 2050. • Energean’s strategy to Net-Zero emissions by 2050: • > Short-term plan – by 2025. • > Medium-term plan – by 2035. • > Long-term plan – by 2050. • Improved our Carbon Disclosure Project (CDP) score to A from B in 2022-, for Climate Change • Continued to align our annual reporting to the TCFD recommendations. • Successful roll out of “green electricity” at all our operated sites • Continued as a member and participant of the Terra Carta and Sustainable Markets Initiative • During 2022, we maintained our zero oil spills record, a record that we hold since the beginning of our operations in 2008. • Grand sponsor of the 22nd “Trofeo Del Mare” (“ The Trophy of the Sea ”), the International Maritime Awards 2022, that took place in Marina di Ragusa. The awards highlight the excellent work of men, women and institutions who are committed to and passionate about the Mediterranean Sea – Sicily / Italy. • Maintenance of Telemetric Stations in surface waters of Nestos River Delta, Lakes Vistonida-Ismarida and Thassos Island Management Body – Northeastern Greece. • Organised and performed a beach clean-up at Richo Beach, in collaboration with the Municipality of Paggaion, in the villages of Nea Peramos & Nea Iraklitsa – Kavala / Greece. • Performed a beach clean-up in the village of Al Maadeyah, in cooperation with AQP and “GoClean” – Egypt. • Performed an invasive species survey and treatment at the onshore valve station area, in accordance with the National Nature and Parks Authority guidelines of Israel. Energean collaborated with: • UN Global Compact. • UN Global Working Group participation. • Maala, a non-profit, CSR standards-setting organization in Israel, which has set a dedicated CSR index on Tel Aviv Stock Exchange. Maala’s CSR Index is an ESG rating system used as an assessment tool, benchmarking Israeli companies on their CSR performance. Energean was rated at Platinum Level at the 2022 Maala ESG Index – Israel. • Management body of the Nestos River Delta, Lakes Vistonida-Ismarida and Thassos Island – Northeastern Greece. • The Greek Embassy – Podgorica, Montenegro. • “Caritas Diocesana”, a Catholic organisation for charity – Vasto, Siracusa and Pozzallo, Italy. • “Go Clean”, a recycling solutions company – Egypt. • The Regional Unit of Kavala – Greece. • The Municipality of Bar – City of Bar, Montenegro. • “IdeaVita”, an organisation with the aim of designing and implementing independent life paths to people with disabilities, affirming and guaranteeing their right to a full and independent life over time – Milan, Italy. • The American University of Cairo – Egypt. • “Etgarim”, an NGO dedicated to the empowerment and social integration of people with disabilities through outdoor sports – Haifa, Israel. • “Athletic Club of Kavala – Department of Wheelchair Basketball” – Kavala, Greece. • Energean’s Joint Venture, Abu Qir Petroleum (AQP) – Egypt. • “Aretusa” Handball Team – Siracusa, Italy. • The Nature and Parks Authority – Israel. Page 51 of 255 ![]() STRATEGIC REPORT • The Holy Diocese of Philippi, Neapolis and Thassos – Northeastern Greece. • Democritus University of Thrace (DUTH), Department of Environmental Engineering – Xanthi, Greece. • Order of Journalists of Molise – Vasto, Italy. • Dar Al Orman Association, an NGO that performs charity work – Egypt. • The Technion (the Israel Institute of Technology) – Israel. • MDA Hellas (the Muscular Dystrophy Association of Greece), a non-profit organisation that supports people that suffer with neuromuscular diseases – Greece. • University of Studies Insubria – Varese, Italy. • “Yeladim – Fair Chance for Children”, an NGO which takes care of children that were removed from their homes and live in boarding schools – Israel. • LILT, the National Association for the Research Against Cancer – Italy. • “Special Olympics Italia”, an organisation that promotes sport as a means of inclusion for children and adults with intellectual disabilities – Italy. • Rahaf Sailing and Surfing Club, a Club that supports young sailors from low-income communities – Rehaf, Israel. • OKAK (Kavala’s Track and Field Athletic Club) – Kavala, Greece. • Alma Mater Studiorum, University of Studies Bologna – Italy. • Egyptian Petroleum Sector – Egypt. • The Prefectural Association of People with Disabilities of Kavala – Greece. • The Health Center of Prinos – Island of Thassos, Greece. • Assorisorse – Natural Resources and Sustainable Energy, a Confindustria Association made up of about 100 companies committed to enhancing natural resources and intellectual skills through technological innovation and the circular economy, with the aim of decarbonising industrial processes and achieving environmental, economic and social sustainability – Italy. • San Benedetto del Tronto’s Port Authorities, Coast Guard, and Harbour Master’s Office – Italy. • Montani Technical Institute – Fermo, Italy. • The Municipality of Zitsa – Ioannina, Greece. • “Così come sei”, an association committed to respond to the needs for inclusion of families with disabled children – Ragusa, Italy. Excellence through our people Energean’s successes in 2022 were due to tireless effort from our people. Our commitment is to continue motivating, engaging with, and further developing our diverse workforce to enable the delivery of our goals and strategy. We are focused on offering an attractive workplace and being an employer of choice, thus learning and development and reward and compensation plans have been at the forefront of our activities in 2022. The emphasis on compensation was essential during 2022 due to the rising cost of living in most parts of the world, mostly as a result of the ongoing conflict in Ukraine. We foster an inclusive culture that enables diversity of thought, and for the first ever time this year we conducted a culture survey and benchmarked our Diversity, Equity and Inclusion standards and processes against global best practices. Learning and development We invest in the potential of our people, who are the real facilitators of our growth, to facilitate the advancement of their career within our company. In 2022, there was a 195% y-o-y increase in the overall training hours completed to over 19 hours of learning in the year. In addition, at the end of 2022 we started the process of incorporating the Udemy business e-learning library to our learning management system to further support the continuous development of hard and soft skills. Page 52 of 255 ![]() STRATEGIC REPORT At Energean we are committed in having the “right people for the right position” – our staff’s career development is key to Energean’s success. This year, 22 of our colleagues were offered an internal move opportunity, either via promotions or through lateral transfers in roles that better met their career aspirations and the company needs. Compensation and benefits We are committed to offer competitive compensation and benefits packages, particularly in 2022 when the cost of living saw a significant increase in the majority of the countries that we operate. We monitor the market aiming to ensure that our workforce feels fulfilled with their careers at Energean and are motivated to perform at the best of their abilities. We conducted our first group-wide compensation and benefits benchmark allowing an objective and data-driven evaluation of both. This benchmark has allowed us to better structure our reward plans in order to attract future and retain existing employees. At a local level we adjusted our compensation and benefit plan in order to align these packages across the Group. These packages also factored in differences in inflation across of countries’ of operations. As a result, we have reviewed both the salaries and benefits in each country that we operate in to support all our colleagues with the aim to minimize the impact of rising inflation. In addition, as our culture is driven by performance and great results aiming to reward and recognise those striving for excellence, we continue to offer variable pay in the form of cash bonus, LTIP and deferred bonuses to our employees as well as salary adjustments following yearly performance appraisals. During 2022 we commenced the implementation of the compensation module for our SAP SuccessFactors, and we expect this module to go live on the first quarter of 2023. This module, combined with the performance management system also on SuccessFactors, will allow the management team to make more informed decisions on compensation and benefits across the group, incorporating the group grading structure, the compensation and benefits benchmark, the individual performance and consolidate all the compensation and benefits information for all Energean employees. Employee engagement We engage with our people through regular team and townhall meetings, messages from the CEO and our intranet. We aim to have an open culture where people can actively contribute towards our success. This year we conducted our first ever culture survey to understand how people perceive our culture and to redefine the way we behave, work, and interact with each other. The results of this survey have been received and analysed and in 2023 we will define the Energean culture of tomorrow and meet the needs of our multicultural group. We respect the rights of all our employees to join a legitimate trade union and bargain collectively – we have collective bargaining agreements in place. Diversity, Equity and Inclusion (DEI) We consider diversity, equity, and inclusion business critical, not a compliance necessity and we continue our participation in the UN Compact Global DEI working group. Our aim is for our workforce to be truly representative of all sections of society, and for each employee to feel respected and able to give their best. In addition to the equal opportunities policy, we introduced this year the diversity, equity and inclusion policy while setting simultaneously ambitious 3-year plan targeting holistically our DEI practices. This includes the attraction and retention of people, performance management, communications, learning and development as well as responsible sourcing, community, governmental relationships, and philanthropy. Our target is to enable a systematic implementation of the DEI practices beyond of what is required or expected, benchmarked by international standards. Focusing on gender equality, for another consecutive year we increased our overall percentage of women at Energean from 18% to 23% by increasing the representation in senior and middle management and the rest of the staff. The percentage of women at the executive committee level decreased because of the restructuring of the committee to reduce the overall number of people on the committee (2022: 22%; 2021: 38%). Finally, our gender pay gap for 2022 was -15% at median hourly wage rates. Page 53 of 255 ![]() STRATEGIC REPORT We are proud to have doubled the under 30s population ensuring that we provide exciting career opportunities to the younger generation, tackling in parallel the ageing workforce and talent gap in the oil and gas industry by preparing the next generation of Energean leaders. In 2022, our underlying employee retention rate was 87.33%, reduced to 62.67% after taking into account exceptional circumstances at our operations in Greece. Our turnover rate that measures employee resignations, remained fairly stable at 5.93% compared to 4.53% in 2021. Headcount by seniority and gender Gender balance by seniority Men Women Total Board 6 3 9 Executive Committee 7 2 9 Senior Management 18 8 26 Middle Management 35 11 46 Rest of staff 343 103 446 Gender balance by seniority                 7JXY TK XYFKK 2NIIQJ 2FSFLJRJSY 8JSNTW 2FSFLJRJSY \*]JHZYN[J (TRRNYYJJ 'TFWI TK )NWJHYTWX 2JS