Leviathan budget jumps

Costs will rise as drilling is taking longer than expected.

The Israeli partners in the Leviathan natural gas field today notified the Tel Aviv Stock Exchange (TASE) that they have approved the work plan and budget proposed by their US partner and project operator, Noble Energy Inc. (NYSE: NBL).

The budget for the Leviathan 1 exploratory well could overshoot the original $150 million budget to reach $190 million. "The higher budget is because the drilling has taken two months longer than planned, due to technical problems," Noble Energy told its partners.

The Leviathan 2 well is scheduled to begin drilling next week. Drilling will take about three months, at an estimated cost of $70 million.

The production tests will taken 2-3 weeks, and cost an estimated $34 million.

Noble Energy owns 39.66% of Leviathan, Delek Group Ltd. (TASE: DLEKG) units Avner Oil and Gas LP (TASE: AVNR.L) and Delek Drilling LP (TASE: DEDR.L) each own 22.67% and Ratio Oil Exploration (1992) LP (TASE:RATI.L) owns 15%.

Published by Globes [online], Israel business news - www.globes-online.com - on March 9, 2011

© Copyright of Globes Publisher Itonut (1983) Ltd. 2011

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