Energy company Isramco Ltd. (Nasdaq: ISRL; TASE: ISRA.L) is preparing for further natural gas exploration, which it intends to finance through a rights offering. Last week, the company, controlled by chairman Jacob Maimon through Equital Ltd. (TASE:EQTL), filed a shelf prospectus to raise up to NIS 90 million. The company has not yet decided on the structure or date of the offering.
The public owns 67% of Isramco, and Equital subsidiary Naphtha Israel Petroleum Corp. (TASE: NFTA) owns 29%.
If Isramco raises NIS 90 million, Naphtha can be expected to inject NIS 26 million into the company.
The rights issue follows the natural gas discoveries in commercial quantities at the Tamar-1 and Dalit-1 wells, in which Isramco is a partner. Production tests of the Tamar-1 well indicate 142 billion cubic meters of gas, which could generate $30 billion revenue over 25 years. In late March, commercial quantities of gas at the Dalit-1 well were announced. Production tests of the well are now underway, with the gas reserves estimated at 20 billion cubic meters.
Last month, Clal Finance Batucha analyst Gal Reiter gave Isramco a "Buy" recommendation with a target price of NIS 0.81.
Isramco's share closed at $42.48 on Nasdaq on Friday. The share fell 1.3% in morning trading on the TASE today to NIS 0.54, after rising 3.2% yesterday.
Published by Globes [online], Israel business news - www.globes-online.com - on April 13, 2009
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