Electric Authority of Cyprus talks with Delek, Noble Energy

Noble Energy expects to begin drilling in Block 12, located in Cyprus’ economic waters, by the end of the month.

September 13, 2011 23:17
1 minute read.
Leviathan holds 453 billion cu.m. of gas [file]

Leviathan 311. (photo credit: Courtesy of Albatross)

The Electric Authority of Cyprus wants to partner with Delek Group, controlled by Yitzhak Tshuva and Noble Energy in a project to build storage, liquefying, and export facilities for natural gas.

According to parties involved in negotiations, the EAC would like to be a minority shareholder in the project, whose overall investment might reach $8 billion.

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The facilities are meant to be used for exporting gas from the Leviathan gas field, as well as any other field discovered in the future in Cyprus’ maritime exclusive economic zone.

Noble Energy expects to begin drilling in Block 12, located in Cyprus’ economic waters, by the end of the month. The drilling is intended to validate early estimates that a gas field at least the size of Tamar exists at that location.

Representatives from Delek Group, Noble Energy, and the Cyprus Energy Regulatory Authority participated in a meeting hosted by the EAC in Nicosia, the capital of Cyprus. The parties were pleased with the discussions, and were optimistic about the possibility of future partnerships. This meeting was one of many between the parties over an extended period. EAC representatives said that they are extremely interested in reaching an agreement with the Israeli-American group as soon as possible.

Cypriot Authorities intend to take advantage of the crisis to enlarge their natural gas output by building two closed cycle natural gas power stations, which will come on line in the summer of 2012. Cypriot authorities estimate that the new power stations will increase the state’s consumption of natural gas to 2 BCM a year.

Noble Energy owns 100 percent of the Block 12 concession and Delek Group units Avner Oil and Gas LP and Delek Drilling LP have an option to acquire 30% of it. Noble Energy and Delek are also partners in the Leviathan, Tamar, and other Israeli offshore natural gas and oil licenses.

Delek Group’s share price rose 2.9% in early trading today to NIS 525, giving a market cap of NIS 5.8 billion.

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