TEL AVIV and ABU DHABI, April 26, 2021 /PRNewswire/ -- Delek Drilling of Israel has announced the signing of a non-binding Memorandum of Understanding ("MoU") with Mubadala Petroleum of Abu Dhabi, UAE for the sale of Delek Drilling's 22% non-operated stake in the Tamar gas field offshore Israel. If finalized, the transaction will be the largest commercial agreement following the 'The Abraham Accords Peace Agreement: Treaty of Peace, Diplomatic Relations and Full Normalization Between the United Arab Emirates and the State of Israel', signed in August 2020.
The partners in the Tamar project are Delek Drilling (22%), Chevron (25% and operator), Isramco (28.75%), Tamar Petroleum (16.75%), Dor Gas (4%) and Everest (3.5%). 2P reserves in the Tamar lease, after production of more than 69.3 BCM, is approx. 300 BCM of Natural Gas and 14 million barrels of condensate (Source: NSAI, January 2020). Under the Gas Framework, outlined by the Government of Israel, Delek Drilling is obliged to sell all of its holdings in Tamar by the end of 2021.
The Tamar field was discovered in 2009 and is located c. 90 km west of Haifa, offshore Israel, at an overall depth of c. 5,000 meters below sea level, and in waters that are 1,700 meters deep. Production began in 2013, where the Natural Gas in Tamar is extracted through five production wells. The gas flows through two c.140 km pipelines to the primary and main processing facility on the Tamar Platform where most of the gas processing takes place. The Natural Gas is then transmitted from the platform through a pipeline to the onshore terminal in Ashdod, and into the Israeli market through the INGL national gas pipeline with a proportion being exported on to Jordan and Egypt.
Gas from Tamar is playing a critical role in de-carbonising the region as gas-produced electricity rapidly replaces electricity derived from coal. If finalized, the transaction will also complement Mubadala Petroleum's gas-biased portfolio strategy in line with its proactive approach to Environmental, Social & Governance (ESG) considerations and its energy transition goals.
Mubadala Petroleum is a leading international, upstream oil and gas exploration and production company with a primary geographic focus on the Middle East and North Africa, Russia and Southeast Asia, with assets in 10 countries. Mubadala Petroleum was established in 2012 and is a wholly-owned subsidiary of Mubadala Investment Company, which is owned by the Government of Abu Dhabi.
Post-sale of Tamar, Delek Drilling will own a 45.3% stake in the giant Leviathan gas field offshore Israel which has 2P reserves of 22.8 tcf (649 bcm) of gas and 41m mmbbl of condensate, production capacity of 1.2 bcf/d and the multi-decade reserve life; and a 30% stake in the Aphrodite field offshore Cyprus with 2C resources of 3.5tcf. The Company has a low risk growth strategy to grow reserves and production from its existing asset base. The Company will also expand its exploration portfolio in the Mediterranean region to grow resources and invest in energy transition technologies.
Yossi Abu, CEO of Delek Drilling said:
"This transaction has the potential to be another major development in our ongoing vison for Natural Gas commercial strategic alignment in the Middle East, whereby Natural Gas becomes a source of collaboration in the region. We are proud to have signed this MoU following the Abraham Accords Peace Agreement between Israel and the UAE. The development is not only a significant endorsement of the quality of the Tamar reservoir and the Levant basin but also a major support for the East Mediterranean Natural Gas sector. I would like to thank my counter party at Mubadala Petroleum and our clients in Israel, Egypt and Jordan."
For further information, please go to the Investor section of the Delek Drilling website: https://www.delekdrilling.com/investor-relations/immediate-reports
About Delek Drilling
Delek Drilling is the leading Israeli energy partnership in the exploration, development, production and sale of natural gas and condensate.
Delek Drilling, together with Noble Energy, Inc., have led the natural gas revolution in Israel. Following decades of enormous and fruitless investment in financing gas and oil exploration by successive Israeli governments, a government decision was taken to let go of its involvement in oil and natural gas exploration and transfer this activity to the private sector, a move that led to significant discoveries off the coast of Israel.
Today Delek Drilling is partner in several major gas discoveries in the Eastern Mediterranean including, among others, Tamar (306 billion cubic meters - BCM), Leviathan – the largest deep water discovery in the world at that time (621 BCM), Aphrodite in Cyprus (129 BCM), and others.
For further information, please contact:
Nadav Peri, Delek Drilling
Li-or Avnon, Together
+972 50 2111008
Billy Clegg / Owen Roberts / Violet Wilson, Camarco
+44 (0)203 757 4983