Leviathan Partnership authorises $120mn Feed

Leviathan partners have approved a $120mn front-end engineering and design contract for the development of the giant gas field offshore Israel. The three partners – Delek Group (45.3%), Noble Energy (39.7%) and Ratio (15%) – authorised Noble Energy, the operator, to start the Feed phase.

In a filing to the Tel Aviv Stock Exchange (TASE) the Israeli partners said that Noble Energy could sign contracts for "a detailed engineering plan" for the project. The engineering work will include the design of the gas treatment and production rig and other activities. The fixed rig will be 10 km off shore and will be connected to a second entry point to Israel in the north of the country.

In the filings the companies said that they planned to take final investment decisioni in the fourth quarter of this year and were at various phases of negotiations with potential customers but so far no meaningful contract has been signed.

Last week at a conference in Tel Aviv, Yossi Abu, Delek Group's chief of energy business, said that the partnership will invest NIS 500mn ($135mn) this year. The latest filing confirmed that. Abu also said that the energy companies have a tender for a drilling rig. That rig will drill first another well in Tamar gas field. The drilling rig was not mentioned in the filing.

Boundaries of the Levant Basin (credit:US Energy Information Administration)

The release did not say who won the contract but reports in the media named Wood Group. In 2011, Wood Group's Alliance Engineering won the contract to provide detailed engineering and design services for Noble Energy's Tamar Platform Project.

Ya'acov Zalel