Delek in, Alon out of Cypriot Gas Exploration Rights

From Hareetz

By Eran Azran

Some Israeli tycoons have been shut out of natural gas exploration ventures in Cyprus, but one did get in – Yitzhak Tshuva’s Delek Group.

The Israeli firms Delek Drilling and Avner, both units of Delek Group, signed an agreement on Monday for a 30 percent interest in exploration rights for gas and oil off Cyprus’s southern shore. The  exploration is being carried out by Texas-based oil company Noble Energy, which is working with Delek in petroleum exploration in Israeli waters.

Meanwhile, Alon Natural Gas Exploration – David Weissman’s firm – was involved in the discovery of the Tamar natural gas field off Israel’s coast. However, it made a formal announcement Monday that it did not win its bid to drill for oil and gas in Cyprus’ economic waters.

This followed an announcement Sunday by ILDC Energy, an exploration company headed by Ofer Nimrodi, that it was not expecting to win its bid.

Alon has a 25% stake in a consortium of companies that bid for a license to search for and produce offshore natural gas in Cyprus, in blocks 10 and 11. The consortium includes Sigma Exploration, a group of American and Cypriot companies, which holds the remaining shares. To date, Alon has invested 1.5 million euros in the bid, which included preparations and preliminary seismic surveys.

The winner of the tender was the French company Total, one of the largest energy corporations in the world. Total announced it would conduct a series of 10 exploratory drillings for gas and oil over the next three years. It is thought that it will focus mainly on oil. Total paid 24 million euros for the permits.

ILDC Energy announced that its subsidiary, Immanuel International, received a letter from the Ministry of Commerce, Industry and Tourism of Cyprus, indicating that the permit for block 9 would not be given to the consortium it is part of.

The bid was won by a consortium which includes ENI from Italy and KOGAS from South Korea. The two companies also obtained permits for blocks 2 and 3, for which they paid 150 million euros.

Some reports suggest that one-third of the 15 bidding companies were from Israel. In addition to Alon and ILDC Energy, Yitzhak Tshuva’s Delek, in association with two Italian companies and the Australian Woodside, was one of the bidders for permits in Block 9, which ultimately went to ENI and KOGAS.

Other Israeli bidders were Modi’in Energy, which competed with Dor Chemicals and Nafta but apparently lost out.

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