Following the unclarity of the past few days, the holdings in the attractive Gal marine permit are becoming clear. Over the weekend, Ratio and Israel Opportunity signed an agreement stipulating that Israel Opportunity will join the Neta and Roi licenses in the area of the previous Gal permit as a secondary partner holding 10%. By doing so Israel Opportunity joins the Italian company Edison which will serve as the operator in both licenses. According to the request for the two licenses submitted to the Commissioner of Petroleum Affairs from the Ministry of National Infrastructures on Thursday, Ratio will hold 70% of the licenses, the Italian Edison will hold 20% and Israel Opportunity will hold 10%.
According to the agreement entered between Ratio and Israel Opportunity, the latter will hold 10% of the rights to the Neta and Roi licenses and the Partnership has until December 13, to receive the approval of the Antitrust Commissioner for joining the licenses. If the Partnership fails to receive the approval it will have to withdraw from the new request.
Concurrently, Israel Opportunity reported today that the general partner’s board of directors approved and authorized the general partner’s management to perform an issue through warrants (series 5). According to the decision of the board of directors the warrants will be distributed, consideration free, to holders of participating units in Israel Opportunity and holders of option 4 at a share of 1:10, meaning one new warrant for each holder of 10 participating units or option no. 4. The options can be exercised until the end of 2013 for an exercise price of 50 agorot. A complete exercise of series 5 options will infuse approx. 65M NIS to the partnership’s fund.
Note that the Aphrodite 2 drilling in the Yishai license, one of the Pelagic licenses in which Israel Opportunity holds 10% is currently being executed. The Partnership has sufficient liquid resources to finance its share in the drilling as well as the work plan planned for 2013. Exercising the option will infuse additional financing resources into the Partnership’s fund and will allow the Partnership’s management to finance its future activity in the field of oil and gas explorations.
In any case the issue is subject, inter alia, to the final decision of the general partner’s board and publishing the shelf offer report as well as the approval of the Tax Authorities and Stock Exchange for listing the securities to be issued as said. The company notes that on the date of this report, there is no certainty regarding the date and execution of the issue.
Eyal Shuker, CEO of Israel Opportunity expressed his satisfaction from the agreement with Ratio that was signed over the weekend as well as the Partnership’s request submitted to the Commissioner: “we are pleased to be part of submitting a request for licenses in the Gal area and that Ratio chose Edison, the Italian company, as the operator of the licenses. As another international operator active in Israel, the Italian company is a monumental achievement for the local oil and gas exploration industry”. As for its share in the licenses, Shuker adds that “we consider this part of realizing the company’s strategy to build a portfolio of oil and gas exploration licenses in the Mediterranean”. Regarding the planned issue of options Shukeradds that “the company currently has no need for additional financing sources, yet as part of our growth strategy, the company intends to expand its activity in the field of oil and gas explorations and this will require additional financing sources”.