"We're on course to produce gas from Leviathan in 2019"

Yitzhak Tshuva  photo: Gil Yohanan

Delek Group controlling shareholder Yitzhak Tshuva told an investor conference that Egypt would probably sign more gas supply agreements.

"We are headed for very significant and special year. 2019 will be the year in which we produce gas from Leviathan," Delek Group Ltd. (TASE: DLEKG) controlling shareholder Yitzhak Tshuva said today at an investors' conference in the Herods Tel Aviv Hotel.

"In the coming months, we will complete connection of the pipeline to Jordan, and Leviathan will become a major energy supplier in the Middle East. We signed agreements with EMG to supply gas to Egypt, and we believe that additional agreements will be signed for local needs and liquefaction facilities in Egypt. We are taking action to sell our holdings in Tamar by 2021, and we hope it will happen earlier than that. We are moving ahead with a development plan for Aphrodite that will lead to annual production of 6-8 BCM… Prices in Europe now are 40% higher than in Israel, which is good news for development of the gas sector. We are approaching completion of drilling in the Gulf of Mexico, and will consider expanding activity in this region. We will be listed overseas with three arms: the Middle East, the North Sea, and the Gulf of Mexico," Tshuva said.

On options for the disposal of Delek's stake in the Tamar field, CEO Asi Bartfeld told the conference, "We are considering an offering of Delek's share of Tamar on the stock exchange, a large financial concern that will buy the entire quantity, and an overseas offering."

Delek is currently continuing its focus on the energy sector in Israel and worldwide. Commenting on recent developments in Ithaca Energy, which Delek acquired in 2017, Bartfeld said, "After refinancing and completing the partners' deal, Ithaca will generate a very strong cash flow in 2019."

Delek Royalties (TASE: DLRL) CEO Meir Menachem told the conference, "We plan to acquire additional royalties of other gas reservoirs, not just Tamar."

On development of the Leviathan reservoir, Delek Drilling (TASE: DEDR) CEO Yossi Abu said, "Development of Leviathan is on schedule and within the budget we set. Almost 70% of the development has already been completed, and the drilling platform props will reach Israel in early January. Early in the fourth quarter of 2019, we will begin pumping gas from Leviathan to the Israeli economy and the neighboring countries."

Addressing demand in the Israeli economy, Abu said, "A year ago, we expected that 2018 would end with 10.4 BCM in demand. We can now say that 2018 will end with almost 12 BCM in demand (not all of which was supplied). Our forecast is that 2020 will end with 14 BCM in demand in the local economy, mainly due to reduced use of coal. Today, coal is more expensive than natural gas, even before its environmental costs are taken into account."

Published by Globes, Israel business news - en.globes.co.il - on November 11, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

Yitzhak Tshuva  photo: Gil Yohanan
Yitzhak Tshuva photo: Gil Yohanan
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