Noble Energy adjusts Leviathan estimate – YNET
Gas field’s new estimate stands at 14-20 TCF as compared with 10.5-21 TCF six months ago. Ratio’s share loses previously gained 5% following report
Shay Salinas, Calcalist
Published: 12.20.11, 07:48 / Israel Business
Noble Energy announced Monday that it had adjusted its resource estimate of the Leviathan gas field located off the shores of Israel.
The new estimate published by the field operator is for 14-20 TCF, whereas the previous estimate from six months ago was for 10.5-21 TCF. Furthermore, the best prospect production forecast climbed from 15.8 TCF to 17 TCF.
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Tamar partners negotiating $250M deals / Lior Gutman, Calcalist
Natural gas partnership holding talks with Nesher, Hadera Paper Mills and Paz over one BCM, 15-year supply contracts
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Noble CEO Charles Davidson said, “This upward adjustment of the Leviathan 3 field resources is an encouraging sign for the company and its investors. We have also dispatched a team to the field in order to identify prospects for commercializing the field’s gas.”
In regards to the oil reservoir in the field, Noble Energy had nothing new to announce. The company’s last estimate, also from six months ago, was for 3-4.2 billion barrels at a probability of 8%-17%.
Ownership of the Leviathan field is shared by Ratio (15%), Delek Energy through Delek Drilling and Avner (43.34%), and Noble Energy (39.66%).
Noble also announced that the development of the Tamar field was on schedule and was set to commence flow tests at the end of 2012. This validates the commercial development schedule according to which Tamar will be online by 2013.
http://www.ynetnews.com/articles/0,7340,L-4163976,00.html
Tamar partners negotiating $250M deals – YNET
Natural gas partnership holding talks with Nesher, Hadera Paper Mills and Paz over one BCM, 15-year supply contracts
Lior Gutman, Calcalist
Published: 12.18.11, 14:31 / Israel Business
The Tamar gas partnership is in advanced talks with the Paz energy corporation, Nesher cement company and Hadera Paper Mills, Calcalist has learned.
Paz, controlled by Zadik Bino, and IDB’s Hadera Paper Mills are already clients of the depleting Tethys Sea license owned by Delek (53%) and Noble Energy (47%), which have additional power stations under construction scheduled for operation by the end of the decade.
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IEC to buy $10-20B of gas from Tshuva / Amir Ben-David
Biggest deal in Israeli economy’s history underway: Electric Coro receives permission to purchase natural gas from Tamar partnership
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Calcalist has learned that the contracts are for a 15-year period and are valued at $220-$250 million, in 2011 currency.
Estimates are that the companies are seeking to convert their present short-term, high-priced ($8 per million BTU) contracts with Tamar to long-term agreements and cut prices down to $6.05–$6.6 per MMBTU.
Paz declined to comment; Clal Industries, Hadera Paper Mills and Nesher’s parent company declined to comment as well.
Deal yet to be approved
On Thursday, the Israel Electric Corporation gave the stamp of approval to the largest gas deal in Israel. The two-stage deal reflects a price of $5.5 per MMBTU.
Currently the deal is pending the approval of the Electricity Authority, the Antitrust Authority and the Ministries of Finance and National Infrastructures.
As revealed by Calcalist, the IEC subjects the deal to two conditions: First, the price will beat the market’s prices and second, the regulatory changes allow the deal. The Ministries of Finance and Infrastructures doubt the feasibility of such a deal as it constitutes a cartel.
In response to Calcalist’s inquiry, the antitrust commissioner replied that the “issue is under examination”, and in the event that the condition does not get the nod, the parties would return to the negotiation table.
The second condition relates to the recommendations of the committee for gas prices control expected at the end of the month. Estimates are the committee will seek to set the deal’s price as a benchmark for future gas deals until new suppliers join the market.
Why have gas prices soared?
IEC CEO Eli Glickman explained that the IEC consulted several local and global consultancy agencies before signing Tuesday’s deal, and examined worldwide prices and similar deals.
“We got an optimal price which will allow us to supply electricity for lower tariffs than today. The question is who will enjoy the low power-station fuel tariff – consumers, private manufacturers or the IEC.
“In times of a social economy, cottage cheese prices are a derivative of electricity prices so in the long run, consumers will benefit from the electricity prices.”
The IEC was troubled by the price issue, anxious about scathing public criticism regarding the tariff hike. As electricity prices are a direct derivative of production fuel costs of the electricity monopoly.
In December 2009, the corporation signed a memorandum of understanding with the Tamar license for the supply of gas at about $4.5 per unit. In the two years since, gas prices leapt nearly 20% in a market where IEC is a monopsony and has the power to set deal terms for suppliers.
Nonetheless, the Ministries of Finance and Infrastructure claim the pricing is “reasonable” on the backdrop of climbing global prices and exchange rate and CPI changes which drive prices up as compared to the deal’s price.
Furthermore, the closest reference price was the mega-deal between Israel Corporation and Egyptian EMG which was $5.2 per unit, thus the current price is not exceptionally high.
http://www.ynetnews.com/articles/0,7340,L-4163091,00.html
IEC board approves deal with Tamar partners – Jerusalem Post
By GLOBES
12/15/2011 21:17
Israel Electric Corp. chairman says deal is “perhaps the largest agreement ever signed in the Israeli economy.”
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The Israel Electric Corporation (IEC) board of directors this evening approved an $8 billion agreement to buy natural gas from the Tamar partners Thursday. The agreement concludes two years of negotiations. The contract is expected to officially be signed before the end of this month.
The Tamar partners are Noble Energy Inc., Isramco Ltd., Delek Group Ltd., Delek
Drilling LP, Avner Oil and Gas LP, and Dor Alon Energy Ltd.
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Tamar’s new gas strata could benefit Leviathan
The agreement will encompass over 15 years of gas sales and the size of the deal is likely to reach $8 billion- $5 per thermal unit. The price will be up for review in mid-2013 when gas from the Tamar field starts flowing.
IEC chairman Yiftach Ron-Tal said that “the agreement is an expression of the gas revolution in which we are living and of the State of Israel’s ability to achieve full energy independence. This is perhaps the largest agreement ever signed in the Israeli economy. This agreement promises Israel stability in gas supply.”
Negotiations dragged on because the IEC refused to withdraw its demand to receive the lowest possible price, which it insisted upon before signing.
http://www.jpost.com/Business/BusinessNews/Article.aspx?id=249663
IEC to buy $10-20B of gas from Tshuva – YNET
Biggest deal in Israeli economy’s history underway: Electric Coro receives permission to purchase natural gas from Tamar partnership
Amir Ben-David
Published: 12.17.11, 08:12 / Israel Business
The biggest deal in the history of the Israeli economy is underway: The Israel Electric Corporation on Thursday received permission from the company’s board of directors to purchase natural gas from the Tamar gas field, located some 90 kilometers (56 miles) west of Haifa.
The deal is estimated at $10-20 billion for the next 15 years.
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Tamar partners in gas talks with S. Korea / Lior Gutman, Calcalist
Deal estimated at NIS 20 billion, subject to regulatory approval and feasibility of shipping gas. If signed, it may help some of partners with production costs and refunding
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The Tamar gas field is owned by several partners, led by the Delek Group controlled by businessman Yitzhak Tshuva and American company Noble Energy.
According to estimates, starting in 2013, the Tamar drilling will produce natural gas at a sufficient quantity to meet the State of Israel’s energy needs for 15 to 20 years.
According to the agreement, Tamar will supply IEC with some 3 billion cubic meters of gas a year, for 15 years – a quantity worth $10 billion, which will be paid by 2027.
An expansion of the gas pipe system will allow the transfer of an additional quantity, bringing the total value of the deal to some $20 billion.
Israeli’s electricity bills are expected to drop as a result of the use of natural gas, which serves as a cheaper and cleaner source of electricity production than other fuels, like diesel fuel or fuel oil.
http://www.ynetnews.com/articles/0,7340,L-4162708,00.html