Gas Subsidiaries Update

The following updates are based on information released by Delek Group gas subsidiaries, Delek Energy Systems Ltd., Avner Oil & Exploration L.P and Delek Drilling L.P. All financial and business information is given only for the convenience of the reader. The only official financial and business information, is that which is included in the officially published immediate reports and financial reports of Delek Group and its gas subsidiaries, to the Israeli Securities Authority and the Tel Aviv Stock Exchange, in Hebrew. In the event of any conflict between financial and business information given on this site and the Hebrew published immediate reports, the Hebrew published immediate reports shall prevail. More on Delek Group's disclaimer.

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Heads of Agreement for Export LNG

Tel Aviv, February 26, 2013. Delek Group’s subsidiaries announced that a heads of agreement ("HOA") was signed between Levant LNG Marketing Corporation ("Levant") and Gazprom Marketing & Trading Switzerland AG ("GM&T Switzerland") (both "Parties") on February 25, 2013, in reference to the memorandum of understanding that was signed between the parties on March 22, 2012. It was agreed to hold exclusive negotiations for the period of six months in order to sign a binding agreement for the sale of LNG, which includes, inter alia, the following; (1) quantity to be sold will be 3MPTA (4.2 BMC/Y) for a period of 20 years at a price that will be linked to Brent, (2) the sale of LNG shall be made at the exit of the liquefaction facility on an FOB basis ("Free on Board"), (3) the Parties shall agree upon a financing that GM&T Switzerland will grant Levant for the development of the FLNG Facility, by way of equity investment and/or other financial support, in a significant sum, in such scope and terms to be agreed by the parties. Simultaneously with the execution of the HOA and in consideration of the undertaking for exclusivity given by GM&T Switzerland, the Tamar Partners undertook towards GM&T Switzerland that it shall not enter into any agreement with any third party for the sale of LNG produced from the Tamar and Dalit fields during a period of six months. It is also clarified that gas production from the FLNG facility is not expected to affect the Tamar supply to the Israeli market and it is expected to be done by a dedicated production system that will include new development drilling wells for this purpose.


For more information please see the immediate reports as published on TASE.


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