Israeli companies Delek Drilling and Avner Oil Exploration have fulfilled all conditions necessary to merge the two firms that are part of conglomerate Delek Group into a new entity that would have a market value of around US$4.4 billion (16 billion shekels).

Closing date of the merger of partnerships between Delek Drilling and Avner Oil is Wednesday, May 17, and trading of the shares of the new company is expected to begin on May 21, the two firms said in a joint statement.

Via Delek Drilling and Avner Oil, Delek Group holds stakes in Israel’s offshore natural gas fields Tamar and Leviathan.

In November last year, Delek Drilling and Avner Oil Exploration—the smaller partners in the Leviathan field alongside US-based Noble Energy—said that they had signed commitment letters from HSBC and J.P. Morgan, and the funds of between US$1.5 billion and US$1.75 billion would be used for the A1 development phase of the field.

In February this year, the partners in the Leviathan field ratified the final investment decision for the first phase of development, which entails gross capital investment of US$3.75 billion. Noble Energy—which operates Leviathan with a 39.66-percent working interest—said back then that it had sanctioned the first phase of the project, targeting first gas sales for the end of 2019.

Apart from the Delek Drilling and Avner Oil merger, Delek Group was recently active in an overseas transaction with the takeover of North Sea oil and gas operator Ithaca Energy, as part of the Israeli group’s plan to gain more international exposure. Last month, Ithaca Energy said that the conditions of the cash takeover offer by Delek Group had been satisfied and shareholders of Ithaca had accepted the offer, which values the shares of the takeover target at US$646 million.



By Tsvetana Paraskova for Oilprice.com

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