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News // Oil and gas worldwide

Leviathan partnership inks $2 bln sale contract

01 December 2016 , 14:21Neftegaz.RU619

Leviathan Partnership has signed another gas sales contract, taking it nearer a final investment decision on the Leviathan gas field.

 

The FID is expected by the end of this year or early next year.

This time the customer is Or Energies, a power generation operator who signed an agreement to purchase 8.8 bln m³ over a 20-year agreement worth up to $2 bln.

The power station's construction has yet to be approved by the regulators.

 

Last month Leviathan Partnership announced a PSA to sell gas to Paz Group's refinery. So far Leviathan Partnership has secured annual sales of about 4.5-5 bln m³ in 5 agreements 2 of them to power generation facilities which are yet to be built.

Although officially the deadline for the FID is by the end of this year, the actual date is February 20, 2017, the last day in which Delek Group will be able to exercise the loan commitment letters the company signed last month with HSBC and JP Morgan to finance its part in the project.

 

Another obstacle that has yet to be cleared is the sale by Noble Energy of 3% of Tamar gas field to a Harel Group.

Noble is expected to receive $369 mln for the 3% and it said that this sum will be used for its equity investment in Leviathan.

Although Israel energy ministry approved the deal in October 2016, the companies still haven’t announced the transaction's completion.

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