Woodside buys 30 percent of Israel's Leviathan gas field
Australia's Woodside Petroleum Ltd has agreed to buy a 30 percent stake in Israel's huge Leviathan natural gas field in a deal that could be worth as much as $2.5 billion.
The announcement on Monday ended an intense bidding war between a number of foreign firms interested in a share of Leviathan. The field, discovered in 2010, holds an estimated 17 trillion cubic feet of gas, making it the world's largest offshore discovery of the past decade.
Woodside, Australia's biggest oil and gas firm, said it would be the operator of any liquefied natural gas (LNG) development of the field some 80 miles (130 km) off the coast of Israel, once energy poor but now expected to become a gas exporter by the end of the decade.
Woodside said the agreement involves an initial upfront payment of $696 million, a further payment of $200 million once laws permitting LNG export were in force and a $350 million payment on a final investment decision for LNG development. It is also subject to potential annual LNG revenue sharing payments equal to 11.5 percent of Woodside's incremental revenue above an agreed escalating price threshold over the life of the project, capped at $1 billion.
Ratio Oil Exploration, a partner in the US-Israeli consortium currently developing the field, told the Tel Aviv Stock Exchange the deal could be worth up to about $2.5 billion.
"It's tough to understate the significant effects this move will have on the Israeli energy sector, and the economy in general," Ratio chief executive Yigal
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