Sources inform ''Globes'' that Yitzhak Tshuva-controlled Delek Group Ltd. (TASE: DLEKG) subsidiary Delek Energy Systems Ltd. (TASE: DEOL) will bid in both the $400 million tender to build and operate the liquid natural gas (LNG) terminal, and in the NIS 100 million Negev gas distribution tender.
The sources added that Eilat Ashkelon Pipeline Co. Ltd. (EAPC) has withdrawn from the LNG terminal tender, after Accountant General Shuki Oren refused to allow its participation. AEPC was also unable to find an international partner, one of the tender's conditions.
EAPC said in response, "The company will not bid in the pre-qualification stage of the tender, but does not rule out joining the tender in future, depending on the tender's terms."
Delek Energy is the only Israeli company to participate in the tender, after Shafir Civil and Marine Engineering Ltd. also withdrew after it could not find an international partner. Delek Energy submitted a joint bid with Teekay Corporation (NYSE: TK) subsidiary Teekay LNG Partners LP (NYSE: TGP), which controls 10% of the global LNG market.
Other bidders are Norwegian firms Golar LNG Ltd. (Nasdaq: GLNG; OSE: GOL) and Torp LNG AS, as well as Accelerate Inc. and Southern Union Company (NYSE: SUG).
In the Negev gas distribution tender, Delek Energy reportedly plans to set up a subsidiary, which may later also enter the compressed natural gas (CNG) sector to market natural gas to companies that are not hooked up to the national natural gas pipeline.
Delek did not participate in previous natural gas distribution tenders because it was a shareholder in Amisragas Ltd., which did bid in the tenders. Deleks' sales of Amisragas last year paved the way for its participation in new distribution tenders.
Energy sources believe that the discovery of the offshore Tamar and Dalit gas fields, in which Delek is a partner, will boost Israel's natural gas industry. The Gas Economy Law bans the controlling shareholder of a gas supplier to also own a gas distribution network, but does not explicitly ban gas distribution.
Published by Globes [online], Israel business news - www.globes-online.com - on October 20, 2009
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