Tamar partners sign $750m Hadera Paper gas deal

The Tamar Partners will supply 3.3 billion cubic meters of gas over 15 years, beginning in mid-2013.

The Tamar partners today signed their fifth natural gas delivery deal - a $750 million contract to supply up to 3.3 billion cubic meters of gas to Hadera Paper Ltd. (Pink Sheets: HAIPF; TASE: AIP) over 15 years, beginning in mid-2013. The contract is on a "take and pay" basis.

Noble Energy Inc. (NYSE: NBL) owns 36% of Tamar, Delek Group Ltd. (TASE: DLEKG) subsidiaries Avner Oil and Gas LP (TASE: AVNR.L) and Delek Drilling LP (TASE: DEDR.L) each own 15.625%, Isramco Ltd. (Nasdaq: ISRL; TASE: ISRA.L) owns 28.7%, and Dor Alon Energy in Israel (1988) Ltd. (TASE:DRAL) unit Alon Natural Gas Exploration Ltd. (TASE: ALGS) owns 4%.

This is the partnership's fifth contact, following a $1.2 billion contract with Makhteshim Agan Industries Ltd., a $5 billion contract with Dalia Power Energies Ltd., and two contracts worth $1.2 billion altogether with private power companies Ramat Energy Negev Ltd. and Ashdod Energy Ltd. Deliveries Ltd., both owned by Edeltech Ltd. and Turkeys' Zorlu Enerji Elektrik Ureti AS.

A $17 billion contract with Israel Electric Corporation (IEC) (TASE: ELEC.B22) has not yet been ratified by IEC's board of directors, which is haggling over the terms.

Hadera Paper phrased it slightly differently, saying that it would purchase

Hadera Paper is a subsidiary of IDB Holding Corp. Ltd. (TASE:IDBH). Industry sources believe that the Tamar partners will soon sign more gas delivery contracts with another IDB subsidiary, Nesher Cement Enterprises Ltd., as well as with Oil Refineries Ltd. (TASE:ORL) in Haifa and Paz Oil Company's (TASE:PZOL) refinery in Ashdod for 8 million British Thermal Units of gas a year, and up to 118 million British Thermal Units over the contract period.

Delek Group's share price rose 1.5% in morning trading to NIS 800, giving a market cap of NIS 9 billion, Avner's share price rose 1.9% to NIS 2.76, giving a market cap of NIS 9.1 billion, Delek Drilling's share price rose 1% to NIS 15.64, giving a market cap of NIS 8.5 billion, Isramco's share price rose 2.1% to NIS 0.545, giving a market cap of NIS 6.4 billion, and Alon Gas's share price was unchanged at NIS 37.69, giving a market cap of NIS 526 million. Hadera Paper's share price share price fell 0.4% on the TASE to NIS 162.50, giving a market cap of NIS 830 million, after remaining unchanged at $44.10 on Wall Street yesterday.

Published by Globes [online], Israel business news - www.globes-online.com - on January 26, 2012

© Copyright of Globes Publisher Itonut (1983) Ltd. 2012

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