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Palestinians cancel $1.2b Leviathan gas deal

Leviathan
Leviathan
11 Mar, 2015 10:03
שלח תגובה במיילHillel Koren

Palestine Power Generation Co. has cancelled the 20-year deal due to delays caused by the Israel Antitrust Authority.

The decision by Israel Antitrust Authority head David Gilo to break up the monopoly ownership of both the Tamar and Leviathan fields is exacting a price. Leviathan partners Avner Oil and Gas LP (TASE: AVNR.L), Delek Drilling Limited Partnership (TASE: DEDR.L) and Ratio Oil Exploration (1992) LP (TASE:RATI.L) reported this morning that the Palestine Power Generation Co. (PPGC) has cancelled its $1.2 billion contract to buy gas from Leviathan.

In January 2014, PPGC signed an agreement to buy 4.75 billion cubic meters of gas over 20 years.

The Leviathan partners explicitly stated today that the cancellation of the contract was because the Israel Antitrust Authority had failed to grant approvals, delays in approvals for the development of the Leviathan field, and lack of other regulatory approvals.The contract was signed in the American Colony Hotel in Jerusalem in January 2014 between Minister of the Palestinian Energy Authority Dr. Omar Kittaneh, Delek Group controlling shareholder Yitzhak Tshuva and senior company officers, and representatives of Noble Energy and Ratio.

At the time Delek Group controlling shareholder Yitzhak Tshuva said, "I believe that a strong and stable economy between the parties will bring peace and stability to the whole region, and everyone will benefit from a prosperous economy and growth. Peace, economic cooperation, and mutual respect and trust are a joint endeavor. Economic cooperation, such as the agreement signed today, will help bring the countries closer and will contribute to building a basis for peace. It will be possible to create many new jobs and cooperation between businesses and enterprises. Together, these will link the common wish of all the parties to reach understandings and peace."

Published by Globes [online], Israel business news - www.globes-online.com - on March 11, 2015

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

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