Israel Electric Corporation (IEC) (TASE: ELEC.B22) said today that it was informed by Noble Energy Inc. (NYSE: NBL), the operator of the Mari B gas field, that it is reducing the daily supply of natural gas to 88,000 MMBTU, which is only 20% of the amount stipulated in its supply contract.
The IEC hinted in its notification to the TASE that this latest reduction in the amount of gas from the Yam Tethys natural gas field (which contains the Mari B prospect) is expected to cause a rise in costs due to the need to buy alternative and more expensive fuels such as diesel and industrial fuel.
The latest announcement comes after Noble Energy told the IEC earlier this month that it was reducing daily supply to 95,000 MMBTU, 20% of the amount stipulated in the supply contract.
These reductions mean that the IEC will need an extra NIS 10 billion a year to buy alternative fuels. For this reason the IEC has requested a 30% rate hike.
Noble Energy said, "As we announced today, we are working strenuously to connect the Noa and Pinnacles fields to Mari so that we can already supply gas from these fields in the summer."
Published by Globes [online], Israel business news - www.globes-online.com - on May 15, 2012
© Copyright of Globes Publisher Itonut (1983) Ltd. 2012