Tshuva selling Tamar stake to Abu Dhabi co for $1b

Yitzhak Tshuva  / Photo: Einat Levron , Globes

Delek Drilling has signed an MOU for the sale of its 22% holding in the Tamar gas reservoir to Mubadala Petroleum, owned by the Abu Dhabi government.

The Delek Drilling partnership, which holds 22% of the rights in the Tamar natural gas reservoir, has signed a non-binding memorandum of understanding (MOU) for the sale of its holding in the reservoir to Mubadala Petroleum of Abu Dhabi for $1-1.1 billion.

The partners in the Tamar reservoir are: Delek Drilling (22%); Chevron, which is also the operator (25%); Isramco (28.75%); Tamar Petroleum (16.75%), Dor (4%); and Everest (3.5%).

Under the gas market plan approved by the government, the Knesset, and the High Court of Justice, Delek Drilling, which is controlled by Delek Group Ltd. (TASE: DLEKG), in which Yitzhak Tshuva is the major shareholder, is obliged to sell its rights in the Tamar reservoir by the end of 2021. In the past few years, Delek Drilling has tried to dispose of its Tamar holding in various ways, up to now without success.

Mubadala Petroleum is an international natural gas exploration and production company that holds natural gas assets in in the Middle East, North Africa, South-East Asia, and in Russia, operating in ten countries altogether. The company was founded in 2012, and is wholly owned by Mubadala Investments, which is held by the government of Abu Dhabi.

After the sale of its rights in Tamar, Delek Drilling will continued to hold 45.3% of the rights in the Leviathan reservoir, alongside holdings in Ithaca Energy, which operates in the North Sea, and other assets.

Delek Drilling CEO Yossi Abu said, "The MOU signed today is a large step towards the final completion of the gas plan, in accordance with all our undertakings at the outset. I am very proud to lead this move, together with our friends at Mubadala Petroleum. It represents a further, important stage in fulfilling the vision of strong regional cooperation.

"This MOU, which we hope will shortly mature into a final agreement, meets all the criteria we set for ourselves: conformity with the gas plan timetable; a deal that brings value to Delek Drilling shareholders; strengthening of Israel's natural gas economy; and deepening of regional cooperation. Cooperation with Mubadala Petroleum is further substantial evidence of the quality of the Tamar reservoir and the huge potential in the Levant basin, and it will assist in broadening the possibilities for production and exports in the coming years."

Minister of Energy Yuval Steinitz said, "The agreement for the sale of Delek's holding in the Tamar natural gas reservoir to a company form Abu Dhabi represents further proof of success in implementing the gas plan that I initiated and fought to pass several years ago. The gas monopoly has been broken up, and major international companies are coming in and expressing confidence in our gas market. Now, after the signing of the Abraham Accords, a company from an Arab country is also investing in the Israeli gas market. I believe that this is the start of cooperation between the two countries in energy and other economic and diplomatic areas, to the benefit of their citizens."

Published by Globes, Israel business news - en.globes.co.il - on April 26, 2021

© Copyright of Globes Publisher Itonut (1983) Ltd. 2021

Yitzhak Tshuva  / Photo: Einat Levron , Globes
Yitzhak Tshuva / Photo: Einat Levron , Globes
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