BG Int'l to Take Minority Stake in Noble Energy's (NBL) Block 12 Offshore Cyprus | Street Insider (SI)

BG Int'l to Take Minority Stake in Noble Energy's (NBL) Block 12 Offshore Cyprus

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Noble Energy (NYSE: NBL) announced a farm-out agreement for a portion of its interest in Block 12 offshore Cyprus with BG International (“BG”). BG is acquiring a 35 percent interest in Block 12, which includes the Aphrodite natural gas discovery, for total cash consideration of $165 million. Aphrodite, discovered in 2011, has gross mean natural gas resources of approximately four trillion cubic feet. The transaction has an effective date of April 1, 2015, and is expected to close before the end of 2015. Noble Energy will maintain operatorship of Block 12 with a 35 percent interest.

J. Keith Elliott, Noble Energy’s Senior Vice President of Eastern Mediterranean, said, “Entering this upstream partnership with BG in our Cyprus discovery is an important step in moving the project forward for development. BG brings substantial technical, financial and marketing capacity to the partnership. Their longstanding presence and experience in the region are great complements to our own, and we are confident our combined strengths will enhance the value of Block 12. We are continuing to work with the government of Cyprus to finalize Aphrodite development plans. In conjunction with that work, we have recently commenced gas marketing efforts, primarily targeting customers in Egypt, including both domestic purchasers and underutilized liquefied natural gas (LNG) plants.”

In addition to this transaction, Noble Energy announced the sale of its 47 percent interest in the Alon A and Alon C licenses offshore Israel, which include the Tanin and Karish fields, to the Delek Group for a total deal value of $73 million. The divestment of interest in these assets is an important step in fulfilling Noble Energy’s obligations under the recently-approved Regulatory Framework in Israel and will simplify the ultimate sale of Tanin and Karish to a third party.

Completion of both transactions are subject to certain regulatory approvals as well as customary closing conditions and adjustments.

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Click here the Cypriot minister's relevant tweet

Source: http://www.streetinsider.com/Corporate+News/BG+Intl+to+Take+Minority+Stake+in+Noble+Energys+(NBL)+Block+12+Offshore+Cyprus/11099044.html

Noble Energy deal moves company closer to Israel offshore project | Houston Business Journal

David Stover, CEO & COO
Noble Energy Inc.

Noble Energy deal moves company closer to Israel offshore project
Nov 23, 2015, 2:18pm CST

by Suzanne Edwards Reporter, Houston Business Journal

Houston's Noble Energy Inc. (NYSE: NBL) advanced its march toward developing and expanding massive gas fields off the coast of Israel, known as Leviathan and Tamar, despite having faced regulatory pushback from Israel's antitrust regulators.

The independent oil and gas exploration and production company on Nov. 23 announced the sale of its 47 percent stake in the Alon A and Alon C licenses for offshore Israel, which include the Tanin and Karish fields.

David Stover is the president, CEO and COO of Houston-based Noble Energy Inc. (NYSE: NBL), which has reached a new benchmark in its quest to develop a massive gas field off the coast of Israel.

Selling the Tanin and Karish fields was one of the requirements stipulated in the framework agreement that Israeli officials approved in September, which, once honored in full, will pave the way for Noble's development and operation of the Leviathan project.

"The sale of these assets is an important step in realizing the government of Israel’s goal to bring in a new operator to develop these natural gas fields, which will compete for sales with Tamar and Leviathan," Noble Energy said in comments emailed to the Houston Business Journal. "Tamar and Leviathan are, and will remain, operated by Noble Energy."

Noble came close to selling its stakes in Leviathan before canceling the nearly $1 billion sale to Australia's Woodside Petroleum Ltd. (ASX: WPL) in May.

Noble sold its stakes in the Alon A and Alon C licenses to Israel-based Delek Group Ltd. for a deal valued at $73 million. That's slightly less than the $78 million the company had reportedly invested in Tanin and Karish as of Sept. 30, according to its third-quarter earnings report. The deal also accomplishes transferring the responsibility of selling the Tanin and Karish fields squarely to Delek Group, which the company sees as expediting the process of meeting the framework agreement requirements, said Noble.

Tanin and Karish must be sold to a third party as per the framework agreement. The still-remaining elements of the agreement include Noble downsizing its stake in the Tamar gas field to 25 percent. As of February, the company stake in Tamar was 36 percent.

More imminent is Noble's meeting the requirement that it consult with Israel's Knesset Economic Committee, which the company said in its emailed comments would be completed in the coming weeks.

Once Leviathan comes online, the framework agreement also stipulates that the prices at which Noble sells the gas it yields must be capped for domestic customers, the Times of Israel reported.

"With a framework in place, Noble Energy can move forward with reconvening project and execution teams, completing negotiation of gas sales contracts to regional customers that have been waiting for clarity on Noble Energy’s ability to deliver natural gas in a timely manner, and securing the external financing necessary to enable a final investment decision," Noble said in its emailed comments. "With the framework in place now, Noble Energy anticipates making (final investment decisions) by the end of 2016."

"It will take approximately three and one-half to four years from FID for construction and field development before first production commences from Leviathan," Noble went on to say.

The announcement of the sale was accompanied by the announcement of Noble inking a farm-out agreement with BG International Ltd., a subsidiary of London-based BG Group PLC. Under the terms of the farm-out agreement, BG will acquire a 35 percent stake in the Block 12, which includes the Aphrodite natural gas discovery, off the coast of Cyprus for a total cash consideration of $165 million. Noble Energy will continue to operate Block 12 with a 35 percent stake, according to a statement the company released announcing the agreement.

Suzanne Edwards covers energy for the Houston Business Journal. Follow her on Twitter for more. 

Source: http://www.bizjournals.com/houston/blog/drilling-down/2015/11/noble-energy-deal-moves-company-closer-to-israel.html

Energy deal boosts Cypriot gas plans | e-Kathimerini.com

Energy deal boosts Cypriot gas plans

TUESDAY NOVEMBER 24, 2015

• 

TAGS:Cyprus, Energy

A move by British oil and gas company BG Innternational to buy a stake in Cyprus’s offshore mineral deposits is an important step forward for the country’s plans to supply Egypt with natural gas, the East Mediterranean island’s energy minister said on Monday.

Giorgos Lakkotrypis said US company Noble Energy has cut a deal with BG International for a 35 percent stake in an area, or block, where a field estimated to contain more than 4 trillion cubic feet of gas has been found. He added the deal is a vote of confidence in the commercial prospects of Cyprus’s offshore gas deposits.

It also boosts the chances of developing the gas field since BG operates a gas processing plant in Idku, Egypt.

[AP] 

Source: http://www.ekathimerini.com/203697/article/ekathimerini/business/energy-deal-boosts-cypriot-gas-plans

Delek Chief Expects Egypt To Be Anchor Customer For Israeli Natural Gas Production Expansion | Natural Gas Europe

November 22nd, 2015

DELEK CHIEF EXPECTS EGYPT TO BE ANCHOR CUSTOMER FOR ISRAELI NATURAL GAS PRODUCTION EXPANSION

Mr. Tadmor, chairman of Delek Drilling and the CEO of Avner, said at the centre of his vision is a production target of 40 billion cubic metres (bcm), most of it for export, from Israeli assets.

This week Delek Drilling and Avner, both controlled by Delek Group, a partner to the monopoly in Israel natural gas market, reported a surge of 66% in net earnings for the 3rd quarter 2015 to $76 million. The earnings put the companies amongst the best performers in the industry right now.

In the first 9 months of 2015 net earnings amounted to $185 million, a 90% improvement over the same period in 2014. The improved financial results are attributed to an increase in natural gas sales and a drastic reduction in financing costs. The results were possible due to the fact that all of the two companies' revenues come from natural gas sales in Israel with a fixed price of about $5.5 MMbtu. 

Mr. Tadmor's fundamental assumption for the next few years is that demand for natural gas in Egypt will increase as supply from new Egyptian fields, like Zohr, will not be sufficient to close the gap between demand and supply. Therefore, he depicts Israel as "an island of available gas in an ocean of unsatisfied demand."

The background for his vision is an industry in crisis mode, reeling from a 16-month price crash and burdened by $53 billion impairments in just the last quarter. "That it is only the start," Mr. Tamor said. He envisages further "significant reduction in CapEx" across the industry in order to retain dividends. "Companies are making very aggressive divestments of assets (...) in order to stay. We are talking about small companies, with their nose above the water."

Mr. Tadmor expects prices to begin to rise by 2017-2018. That makes development of Israeli assets crucial, he said.

"All those assets--Tamar, Leviathan, Aphrodite [a Cypriot asset, owned by Delek Group and Noble Energy]--are over 1,000 bcm of discovered natural gas, [most of them] in the Israeli EEZ. This is exactly the opportunity that we intend in Delek and Avner to exploit in the years to come."

Mr. Tadmor described the regulatory problems that afflicted the industry in Israel though those are almost behind him now. "The comprehensive framework is so important to create a stable environment that will enable us to invest," he said.

By 2020, Mr. Tadmor wishes for three independent projects to be completed, Tamar, Leviathan, Karish and Tanin, which will produce natural gas for the domestic Israeli market as well as for export from two gas fields with a production capacity of 40 bcm annually. "This is a vision within our reach," he said.

In the near future, however, Mr. Tadmor expects to kick start export to the Jordanian Potash facility, and a bigger contract, exporting gas to Egypt under Dolphinus contract. Then will come Tamar expansion that, if sanctioned by 2016, is expected to be online by 2018, transmitting gas to Egypt's Damietta LNG plant. That expansion should cost $1.5 billion and is contingent upon a contract with Spain's Union Fenosa Gas. Then Noble and Delek will turn their attention to Leviathan, which Mr. Tadmor describes as "a mega project with a $6-7 billion investment utilizing FPSO either on top of the reservoir or near the shore."

The Turkish market will be targeted in phase 2 of the project. "The geopolitics have changed, bringing it [the Turkish option] back to the table," Mr. Tadmor said. "All of a sudden Israel becomes a unique opportunity and becomes a key player in the overall strategy of companies like Eni S.p.A, BG Group Royal Dutch Shell plc, and others."

Natural Gas Europe welcomes all viewpoints. Should you wish to provide an alternative perspective on the above article, please contact editor@minoils.com  

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Source: http://www.naturalgaseurope.com/delek-chief-egypt-anchor-customer-for-israeli-natural-gas-expansion-26525