UAE's Mubadala in talks for 22% stake in Israel's Tamar gas field
London (Quantum Commodity Intelligence) – The UAE's Mubadala Petroleum has signed a preliminary non-binding agreement with Israel's Delek Drilling for a 22% non-operational stake in the offshore Tamar field in the Eastern Mediterranean, the UAE newspaper The National reported Monday, citing a company announcement.
The deal is worth $1.1 billion, Delek Drilling said in a statement.
"The proposed transaction is in line with our strategy of seeking high quality, value accretive and ESG-compliant investments that strengthen our gas-biased portfolio in line with our energy transition targets," Mubadala Petroleum said in a statement.
ESG refers to environmental, social and governance-based investing.
"We look forward to pursuing the next steps in this process," the Abu Dhabi company added.
Israel has seen a rush in gas developments following exploration work in the Tamar and Leviathan gas fields in the Eastern Mediterranean.
There has been growing interest from the Gulf in the potential of the Eastern Mediterranean for further gas yields.
Mubadala Petroleum already operates in the Eastern Mediterranean within the Zohr gas field through the Shorouk Concession, in which it has a 10 per cent stake.
Under the terms of the preliminary agreement between Mubadala Petroleum and Delek Drilling, the Israeli firm will sell its 22% interest in the Tamar and Dalit leases, as well as the partnership's rights in the joint operating agreement governing the leases.
Other partners in the Tamar concession are Noble Energy that has a 25 per cent stake, Isramco that retains a 28.75% interest, Tamar Petroleum which holds a 16.75%, Dor Gas and Everest with 4% and 3.5% interests, respectively.
Should the sale of Delek's stake proceed, Mubadala Petroleum will make an unconditional payment of $1bn and a contingent payment of up to $100 million, which is subject to terms and conditions in the definitive agreement.
The Tamar field, which lies to the the west of the Israeli city of Haifa, was discovered by Noble Energy in 2009. The field, which is estimated to have 200 billion cubic metres of gas is the largest find of its kind in the Eastern Mediterranean's Levant basin.