Noble, Delek say natural gas agreement with Egypt going according to plan to calm investor concerns
Noble, Delek attempt to allay fears of gas export delays to Egypt: The USD 15 bn agreement with Egypt is “advancing as it should,” Israel’s Noble Energy and Delek Drilling said on Sunday, according to Eran Azran’s op-ed piece in Haaretz. The statements follow those made by US Deputy Energy Secretary Dan Brouillette to a group of reporters, including Enterprise, last Thursday that the implementation of the natural gas agreement between Israel and Egypt has been delayed because of security concerns and some infrastructure that still needed to be repaired. Oil Minister Tarek El Molla threw the two companies a bone last week when he said that Egypt expects to begin receiving natural gas from Israel by the end of the year. Tamar Petroleum, whose shares have dropped 50% since it went public, saw its shares rise 8% last following El Molla’s comments. However, El Molla’s estimate of 2 bcm of Israeli gas per year falls short of the 7 bcm figure that was initially mentioned in the agreement, deepening worries amongst investors, including Delek Drilling, which has stakes in the Tamar and Leviathan fields, Azran suggests.
Background: Israel’s Noble Energy and Delek Drilling agreed last year to export natural gas to Egypt through Alaa Arafa-led Dolphinus Holding, a milestone move that bodes well for our intentions to become a major energy hub in the region. Trial shipments from Israel’s Tamar and Leviathan gas fields were originally supposed to come in March of this year, but capacity restrictions posed by Israel’s domestic pipeline network meant that the imports had to be delayed. Delek later said that it would begin commercial natural gas sales to Egypt by the end of June. When it didn’t, Israeli Energy Minister Yuval Steinitz came out to say the holdup was a result of Israel’s “complex regulatory regime.” Israel’s antitrust regulator agreed last month to let partners Noble Energy and Delek Drilling buy into the EMG pipeline.