IO Monthly Update - February 2014
consequential loss or damage with respect to relying on the information herein. Please note that the above information is as of March1st 2014. Industry Updates
'Tamar' Partners sign $500 million Jordanian export deal
Under the agreement, Tamar will supply 66 billion cubic feet of gas a year for 15 years to the Arab Potash Co. and the Jordan Bromine Co. for use at their facilities near the Dead Sea. Both companies are expected to buy a total of 1.8 bcm of natural gas. Natural gas sales are likely to begin in 2016, once the minimal required pipeline infrastructure is completed. Noble announced that the price for the natural gas sold is based on a floor price of at least $6.50 per thousand cubic feet of natural gas with upside linked to Brent crude oil prices. Gross revenues are projected at $500 million, with actual sales dependent on final purchased quantities and oil prices at the time of sale.
Leviathan deal is not certain
The deal of Leviathan partners with Woodside Petroleum Ltd. remains uncertain if Israeli tax issues will remain unresolved until this month’s deal deadline, March 27. It seems that the Ministry of Finance will propose levying a higher tax on gas exports than Woodside wants, endangering the Leviathan deal. According to ''Globes'', Woodside expects a tax of 17-19% on the capital invested in the venture, but the gas exports tax committee appointed by Minister of Finance will recommend recognizing lower yield rates than Woodside wants. The committee's recommendations will be submitted to Prime Minister before they are submitted to the cabinet. Woodside can still hope that Netanyahu will intervene in its favor. After the cabinet decides on the matter, the process to amend the necessary legislation will take a few months, but will not delay closing the Leviathan deal.
Negotiations to sell significant quantities of natural gas from 'Tamar' and 'Leviathan'
According to Noble Energy senior vice-president of the Eastern Mediterranean, Keith Elliott, negotiations with multiple customers to sell significant quantities of natural gas from Tamar and offshore Leviathan field carried.
Shareholders lose faith in Givot Olam CEO, Tovia Luskin
'Following an ongoing management debate over the past several years, the Partnership announced on February 17 2014 that CEO Tuvia Luskin will end his role in the partnership.
New guarantee guidelines might risk holding rights of several partnerships
The Petroleum Commissioner at the Ministry of National Infrastructures, Energy and Water Resources announced new guidelines for existing and new holders of licenses and leases in the form of providing bank guarantees and insurance policy in significant amounts, within a period not exceeding 45 days. This move might endanger several companies that might face difficulties in providing these guarantees and meeting their work program milestones.
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