Pinnacles gas starts flowing today
Delek and Noble Energy's Pinnacles well is due to produce 150 million cubic feet of natural gas a day and help reduce electricity prices.
The Pinnacles field is one of Yam Tethys's two satellite fields, which are being developed as stop-gap measures, due to the depletion of the Mari B well, until the Tamar gas field, also owned by Delek and Noble Energy, together with Isramco Ltd. (Nasdaq: ISRL; TASE: ISRA.L) and Alon Natural Gas Exploration Ltd. (TASE: ALGS) comes on line next year.
The Pinnacles field will save Israel NIS 650 million this summer alone. The natural gas will provide environmental benefits through improved air quality and carbon dioxide emissions reduced by over 250,000 metric tons over the summer months. The field cost $105 million to develop.
Producers will receive $5-6 per million BTU for this gas, and because the gas will replace fuel oil for electricity generation, fuel cost savings to Israel will be about $13 per million BTU. Project schedule was another Pinnacles challenge; each day of delay cost Israel NIS 7 million and three million kilograms of carbon dioxide emissions. The Pinnacles was among the fastest development projects in the industry, taking only ten months from approval to subsea installation.
Noble Energy Mediterranean VP Lawson Freeman said, "We are excited to bring the Pinnacles well on line. With time of the essence, Noble was able to utilize rigs from our Mediterranean drilling program and deploy subsea equipment from our other global projects. We are also pushing hard to accelerate the Noa development in the same way."
Delek Group's share price rose 0.6% in early trading to NIS 630, giving a market cap of NIS 7.1 billion, Avner's share price rose 1.5% to NIS 2.22, giving a market cap of NIS 7.3 billion, and Delek Drilling's share price rose 1.3% to NIS 12.34, giving a market cap of NIS 6.7 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on June 13, 2012
© Copyright of Globes Publisher Itonut (1983) Ltd. 2012
- Tel Aviv market report
- Tel Aviv Stock Exchange
- Israeli stocks in NY
- Arbitrage gaps for dual-listed stocks
- Israeli stocks in Europe
- Israeli stocks on other markets
- Tel Aviv 25 options
- Mutual funds
- Current representative shekel rates
- Historical representative shekel rates
- Bank shekel rates
- Shekel/dollar options