Sources inform "Globes" that Delek Group Ltd. (TASE: DLEKG) and Noble Energy Inc. (NYSE: NBL), for the first time, will go head to head against each other. They will file separate bids in the tenders for Cypriot offshore oil and gas exploration licenses. The two companies have been partners since 1999 in all Israeli oil and gas exploration, including Yam Tethys, Tamar, and Leviathan. They are also partners in Cyprus's Block 12, after Noble Energy sold 30% of the rights to Delek.
Tomorrow is the deadline to submit bids for 12 additional licenses in Cyprus's exclusive economic zone (EEZ).
The sources said that, ahead of the bidding, Delek and Noble Energy have received word that they would have better chances of winning licenses if they bid separately. Delek will reportedly link up with a global major. France's Total SA (NYSE: TOT; Euronext: FP), which has already announced that it will bid in the tenders. Total has considerable experience in building liquefied natural gas (LNG) facilities, and Delek plans to participate in building a facility in Cyprus.
Avner Oil and Gas (TASE: AVNR.L) CEO and Delek Drilling Limited Partnership (TASE: DEDR.L) chairman Gideon Tadmor declined to confirm whether Delek would bid in the Cypriot tenders. In response to a question on the issue at the "Globes" Finance and Capital Markets Conference yesterday, he said, "Wait until Friday."
Modiin Energy Ltd. (TASE:MDIN.L) director Tzahi Sultan gave the same answer, even through Modiin, Isramco (Nasdaq: ISRL; TASE: ISRA.L), and ATP Oil & Gas Corporation (Nasdaq: ATPG) of the US plan to file a joint bid. Israel Electric Corporation (IEC) considered joining the consortium, but could not obtain the necessary permits, although it might join in the future, if the consortium wins a license.
Other Israeli companies will also bid for the licenses, including Ofer Nimrodi-controlled ILDC Energy Ltd. (TASE: IE), and a consortium of Alon Natural Gas Exploration Ltd. (TASE: ALGS) and Dr. Eli Barnea, a founder of Bateman Engineering NV (AIM:BTE) and currently an independent adviser on private electricity production.
The chances of Israeli gas exploration companies winning license have reportedly increased recently, after several major oil companies, including Russian and Chinese firms, which were considered certain to win licenses, decided not to bid in the tenders, due to concerns about a confrontation with Turkey or because of economic feasibility.
Published by Globes, Israel business news - www.globes-online.com - on May 10, 2012
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