Delek and Noble Energy acquire part of the ownership of the Egyptian gas pipeline

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by Ifi Reporter Category:Financial Sep 27, 2018

Delek Drilling and Noble Energy announced that they would acquire 39% of the ownership of the Egyptian gas pipeline. The significance of the decision is that it will be possible to pump gas from Israel to Egypt from the beginning of next year. About eight months ago, Delek Drilling and Egyptian Dolphin Energy agreed to supply gas from the Tamar and Leviathan reservoirs at an estimated value of $ 15 billion. Delek and Noble Energy will use the offshore natural gas pipeline owned by EMG, which connects Ashkelon with the Egyptian transmission system in the El Arish area, for the purpose of natural gas flow. The holdings in the pipeline will be priced at a market value of $ 1.3 billion.
Those who joined the deal are East Gas, an Egyptian government company that deals with gas transportation. The parties will pay 518 million dollars including 370 Nobel fuel and the rest evenly Egyptian partner for the purchase of the property and the right to use, allowing the Tamar partnership Egyptian gas stream during the course of 2018, assuming that the customers where requested.
 The Tamar and Leviathan gas partnerships, which include Delek and Noble Energy, signed a huge deal in February for the sale of gas to industrial customers in Egypt represented by the mysterious dolphin. The transaction involved the sale of gas to a fixed contract for 15 years and totaling about 32 billion cubic meters and worth about $ 7.5 billion from the whale, and parallel transaction of sale of similar financial scale gas from the Tamar When in the early years of the gas supply from the Tamar will take place on the basis of excess Production not sold to the Israeli market.
 From the beginning of the next decade, the parties - the Tamar partnership on the one hand and Egyptian customers on the other - are supposed to fix the gas contract for fixed quantities that will be transferred each year.
 The acquisition of 39% of the share capital of EMG was signed between EMED, a joint venture company owned by Delek Drilling (25%), Noble Energy (25%) and the Egyptian company East Gas Company (50%). In return, the buyers will pay $ 518 million (equivalent to $ 1.3 billion to EMG), Delek Drilling will pay $ 185 million, Noble Energy will pay $ 185 million, and East Gas Company will pay the balance.
Yossi Abu, CEO of Delek Drilling said, "This is the most significant milestone for the Israeli natural gas industry since the discoveries. The whale base becomes the main energy anchor in the Mediterranean Basin with customers in Israel, Egypt and Jordan. The implementation of the transaction fulfills the capacity of the first stage in the whale and leads us to the promotion of increasing capacity from 12 to 21 BCM per year. This is a historic deal that turns Egypt into a regional energy center and puts it in line with significant energy centers around the world. "

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