Israel-based Delek Group has confirmed that it is pursuing acquisition of Chevron’s UK North Sea oil and gas assets.
Image: Delek Group owns the North Sea-focused Ithaca Energy. Photo: courtesy of Ithaca Energy Limited.
Delek Group has submitted a bid in this connection through its fully-owned subsidiary Ithaca Energy and is in talks with Chevron about the possible transaction. In 2017, the Israeli company acquired 100% stake in Ithaca Energy, which is a UK-based oil and gas operator.
The sales process is for Chevron’s stakes in the Alba, Alder, Britannia and its satellites, Captain, Erskine, Elgin/ Franklin and Jade.
The assets involved in the sale are worth around $2bn, reported Reuters.
Chevron, which operates in the UK through its subsidiary Chevron North Sea, had a net daily production averaging 50,000 barrels of liquids and 155 million cubic feet of natural gas, as of 2017, in the country.
Delek Group said that the bid is part of its strategy to grow its activities in the global energy markets and gain additional operational and financial synergies.
The Israeli group plans to fund the potential acquisition using conventional non-recourse debt finance and its existing resources. The closing of the deal is expected to be completed in 2019.
Delek Group, in a statement, said: “It should be noted that there can be no certainty that the submission of a bid or any subsequent discussions will lead to a binding sale and purchase agreement or transaction being concluded.”
Recently, Delek Group, through its subsidiary Delek CT Investment, entered into a deal to acquire Royal Dutch Shell’s stake of 22.45% in the Caesar-Tonga asset in the US Gulf of Mexico for $965m.
Located nearly 300km south-southwest from New Orleans, Louisiana in the Green Canyon area of the US Gulf of Mexico, the Caesar-Tonga is operated by Anadarko Petroleum.
Earlier this month, Chevron agreed to acquire rival US oil and gas company Anadarko Petroleum for $33bn along with assumption of the latter’s net debt. The transaction is being undertaken by Chevron to create a leading producer in the Delaware basin in the US.