Under the terms of the deal, Noble will receive $560m as well as 38.5 million shares of Tamar Petroleum in exchange for the stake in Noble Energy-operated Tamar field, which is located in the Levantine basin of the Eastern Mediterranean Sea..
The deal is part of Noble’s efforts to reduce its share in Israel’s only commercial gas field from 32.5% to 25% in order to comply with the Israel government’s Natural Gas Regulatory Framework to open the market to competition.
As part of this efforts, Noble had earlier divested 3.5% interest in the Tamar field in mid-2016.
Noble Energy chairman, president and CEO David Stover said: "This transaction supports our commitment to sell down our Tamar interest in accordance with the government of Israel's Natural Gas Regulatory Framework.
“It highlights the strong value of our world-class Levant Basin assets, while providing additional upside exposure from our equity interest in Tamar Petroleum.
“These assets are some of the world's most attractive energy investment opportunities, with margins competitive to the best US onshore oil plays and a stable, long-term cash flow profile.”
Planned to be completed by the end of the first quarter of 2018, the deal is subject to Tamar Petroleum's debt financing and customary approvals, terms and conditions.
Noble Energy plans to use the cash proceeds from the transaction to support the capital investment in its Leviathan field development.
Upon completion of the deal, Noble Energy will remain as the operator of Tamar field. Other partners include Isramco Negev 2, Delek Drilling, Avner Oil Exploration and Dor Gas Exploration.
According to the company, the divested working interest in the field represents approximately 62 million cubic feet equivalent per day of 2017 production.
It is also equivalent to proved reserves of approximately 500 billion cubic feet equivalent as of year-end 2017.
Image: Noble Energy intends to reduce its stake in the Tamar gas field offshore Israel. Photo: courtesy of suwatpo/ FreeDigitalPhotos.net.
