Isramco opposes government gas plan

Tamar gas drilling

Isramco fears that the plan could delay development of the Tamar reservoir.

The Isramco partnership opposes the plan for the gas sector being promoted by Prime Minister Benjamin Netanyahu, arguing that it will cause delay in the development of the Tamar reservoir, according to minutes published yesterday by the Ministry of Finance. Isramco's opposition could account for the harsh words exchanged yesterday by Netanyahu with Minister of the Economy Aryeh Deri in Netanyahu's unsuccessful effort to have the Knesset transfer Deri's authority on the gas issue to the cabinet.

As reported in "Globes," Netanyahu told Deri and Minister of Finance Moshe Kahlon that gas tycoon Koby Maimon was trying to torpedo the plan for the gas sector. Netanyahu criticized Deri for joining forces with Kahlon and Haim Katz in helping Maimon, who owns Shas publication "Yom LeYom." Deri, who was taken aback by Netanyahu's remarks, emphatically denied the accusations and left the office. The Prime Minister's Office had to publish a clarification later that the prime minister did not attribute this to Deri, saying, "This is groundless. The prime minister did not accuse Deri of acting as part of any conspiracy whatsoever." Netanyahu's attempts to persuade Deri to reverse his decision to transfer the decision to the cabinet resulted in a severe crisis in his relations with Deri. The two men have not spoken with each other since Monday. As of now, the rift is continuing, although the Prime Minister's Office is striving for reconciliation with the Shas chairman and minister of the economy.

Isramco's position is particularly interesting , in view of the tight secrecy enveloping the group, which has until now refrained from expressing its view in the media, and does not even employ an official spokesman.

Noble Energy, which operates the Tamar gas reservoir, is due to reduce its holdings in the reservoir from 36% at present to 25%. Delek Group Ltd. (TASE: DLEKG), which currently owns 31% of the reservoir, is due to sell its stake to a new partner, which will also own the 11% to be sold by Noble Energy. At the same time, Noble Energy will retain its current 39.66% stake in Leviathan. Isramco, officially controlled by Maimon associate Haim Tsuff, is not a partner in Leviathan. Isramco representatives appeared before the team headed by National Economic Council chairman Eugene Kandel on January 21 as part of an initial series of meetings held by the team with the gas companies' representatives, and later on February 22, when the emerging agreement was presented to Isramco.

According to a summary of the meeting, the principles of the emerging agreement affecting the Tamar reservoir, headed by the exit of Delek Group and the dilution of Noble Energy's holding, were presented to Isramco. The minutes read, "Representatives of Isramco objected to the proposed model. They said the model was liable to have a negative impact on the Tamar reservoir's functioning, and the ability and willingness to make additional investments in it." In more detail, the summary of the meeting stated, "The company's representatives expressed concern about the proposed plan, because the operator of the reservoir, Noble Energy, will have a limited interest in supplying gas from Tamar to the local economy, which is liable to affect Isramco. Representatives of the company emphasized that the Tamar reservoir constituted the company's main gas asset, and that its operation by an operator with a larger interest in a different reservoir was liable to cause difficulties."

Published by Globes [online], Israel business news - www.globes-online.com - on July 1, 2015

© Copyright of Globes Publisher Itonut (1983) Ltd. 2015

Tamar gas drilling
Tamar gas drilling
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