Page 11 - MEOG Week 17 2021

MEOG PROJECTS & COMPANIES MEOG

Mubadala agrees deal to

buy Delek’s stake in Tamar

ISRAEL THE UAE’s Mubadala Petroleum has entered separately, in accordance with their shareholding
into a non-binding memorandum of under- in the project. This will apply to gas sales from
standing (MoU) to acquire Delek Drilling’s 22% Tamar to IEC from October 2020 until June 2021
stake in the Tamar gas field offshore Israel. when the company’s current contract expires.
In an official statement, Delek said that the In September 2019, Isramco and Tamar
parties would work “expeditiously” to finalise agreed to reduce the price the utility pays for its
the deal “no later than May 31, 2021” granting gas from the $6.30 agreed in 2012 to $3.7-4.4
Mubadala exclusivity during the period. per million British thermal units (mmBtu) in
The speed at which Delek is hoping to com- an effort to win back the volume of gas they lost
plete the deal is in part dictated by its mid-De- to partners in the Leviathan gas field in a ten-
cember deadline for divesting the stake in order der several months earlier, when IEC elected to
to comply with a controversial anti-trust settle- diversify sources of gas. However, Chevron and
ment reached in 2015. Delek were opposed to the deal, citing concerns
According to Delek, the $1.1bn agreement about competition between the two fields. The
will also include Delek’s 22% stake in the Dalit Leviathan consortium is comprised of Delek
gas licence. It comprises an unconditional pay- (45.33%), Chevron (39.66%, operator) and Ratio
ment of $1bn and “a contingent payment of up Oil Exploration (15%).
to $100mn, which will be paid subject to certain Chevron, which acquired the assets of Noble
terms and goals being met as shall be agreed Energy last year in a $5bn takeover, was mired in
between the parties”. controversy, having been accused of cutting gas
Delek CEO Yossi Abu said of the deal: “The supplies to IEC, though according to Delek CEO
development is not only a significant endorse- Yossi Abu, no reduction in flows ever took place.
ment of the quality of the Tamar reservoir and Following the Tamar divestment, Delek’s
the Levant basin but also a major support for the assets will be comprised of the equal stakes in the
East Mediterranean gas sector.” giant Leviathan gas field, and the East Med Gas
It replicates an offer reportedly made for (EMG) pipeline stakes, as well as 30% in Cyprus’
Tamar by Edinburgh-based Cairn Energy ear- 3.5 trillion cubic foot (10 bcm) Aphrodite gas
lier this month. field and the onshore Israeli New Ofek and New
Tamar contains 300bn cubic metres of gas Yahel licences. It will also receive royalties from
and Delek has had numerous interested parties the Karish and Tanin fields, which were sold to
in the farm-out process, for which it set up a data fellow London-listed Energean in 2016.
room. The Leviathan partners agreed in January to
Chevron is operator at Tamar with a 25% spend around $235mn to construct the EMG
stake after it bought previous owner Noble pipeline allowing for direct gas exports from the
Energy last year. The other shareholders are assets to Egypt.
Isramco (28.75%), Tamar Petroleum (16.75%), The new line will let the producers maintain
Dor Gas (4%) and Everest (3.5%). a base capacity of 5 bcm per year of supply to
An agreement was reached between the Israel Egypt following the signing of an eight-year sup-
Competition Authority and the Tamar partners, ply deal, with gas flows to kick off in mid-2022
bringing to an end a dispute and saving the Israel and early 2023.
Electric Corp. (IEC) around $30.5mn. Egypt intends to export this gas as well as that
The agreement will allow Isramco, Tamar produced from the giant Zohr field, which lies
Petroleum, Dor and Everest to sell gas to IEC in its own segment of the East Mediterranean.™

Delek’s East Med
assets.

Source: Delek

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