311_offshore oil well.
(photo credit: Associated Press)
Israel Corporation is moving closer to signing an $8 billion natural-gas deal
with Egypt’s East Mediterranean Gas Company (EMG). An EMG negotiating team
arrived in Israel earlier this week for marathon talks with Israel Corp.’s
negotiating team headed by Shuki Gold, the CEO of the company’s power-plants
subsidiary, IC Power Ltd., people familiar with the matter told
For the past 18 months, Israel Corp. has been in talks to buy
natural gas for three power plants at its subsidiaries Israel Chemicals Ltd.,
Oil Refineries Ltd. and OPC Rotem Ltd. Gold, formerly Israel Chemicals
deputy CEO, is in charge of the talks, which are aimed at increasing the company
Israel Corp. reportedly wants to complete the
negotiations soon, because Oil Refineries’s power plant needs gas to begin
operating when the national natural- gas pipeline reaches the Haifa Bay area in
the first quarter of 2011. Oil Refineries must begin operations on the basis of
a directive issued by the Environmental Protection Ministry.
will need natural gas beginning in 2012 for its power station under construction
at Mishor Rotem. Israel Chemicals has a five-year gas-supply contract, signed in
2008, with Yam Tethys, owned by Delek Group Ltd. and Noble Energy Inc., but the
company will probably need to buy more gas for its planned in-house power
Israel Corp.’s three power plants will consume between 2 billion
cubic meters to 2.25 b.cu.m. of natural gas a year, a quantity that will turn
the company into Israel’s secondlargest natural-gas customer, after Israel
Electric Corporation. The value of the 15-year contract, plus the option to
extend, is estimated at $8b.
Delek Group, Noble Energy and the other
partners in the Tamar license have been trying for a long time to get Israel
Corp. as their anchor customer. However, the companies do not yet have a signed
contract, but only letters of intent from IEC and private power producer Dalia
Power Energies Ltd.