Chevron Acquires Noble Energy, Becomes Major Player in Israeli Energy Market

By: TPS

Chevron Corporation announced Monday that it has entered into a definitive agreement with Noble Energy, Inc. to acquire all of the outstanding shares of Noble Energy in an all-stock transaction valued at $5 billion, or $10.38 per share.

Nobel energy is a primary operator of the gas rigs off Israel’s coast.

Chevron stated that the acquisition provides it with “low-cost, proved reserves and attractive undeveloped resources that will enhance an already advantaged upstream portfolio.”

“Noble Energy brings low-capital, cash-generating offshore assets in Israel, strengthening Chevron’s position in the Eastern Mediterranean,” the statement said.

US Secretary of Energy Dan Brouillette stated that the “US-Israeli energy relationship remains stronger than ever.”

“This Administration strongly supports the development of Eastern Mediterranean gas resources, and we look forward to what American ingenuity can do to boost energy development and security in the region,” he said.

Israeli Minister of Energy Yuval Steinitz stated that the acquisition “shows again that when it comes to the relationship between the United States and Israel, economically and energy-wise, the best is truly yet to come.”

Noble Energy played a central role in discovering and developing Israel’s Tamar and Leviathan massive offshore natural gas fields.

The Leviathan Reservoir is a partnership owned by Delek Drilling (45.33%), Noble Energy (39.67%) and Ratio Oil Exploration (15%) that was established in December 2010.

The Leviathan gas field is the largest ever discovered in Israel’s territorial waters and is the second gas field to be connected to Israel after Tamar was connected six years ago.

Leviathan is one of the world’s largest deep-water natural gas discoveries found in the first decade of the 21st century. An estimated 605 BCM, or 22 trillion cubic feet, of natural gas and close to 40 million barrels of condensate have been discovered.

In total, some 35 trillion cubic feet of gas have been found in Israeli waters, worth some $500 billion.

These crucial discoveries enable Israel to become energy independent and have also turned Israel into a major player in the international energy-exporting market.

The Israeli government is expected to earn NIS 17 billion in royalties from the gas discoveries. Additionally, the windfall profits levy is expected to reach up to 10 billion a year by 2040.

(TPS)