Energean Oil & Gas Group signed contracts to supply private Israeli power plants with natural gas, the first deals to compete with the partners which dominate the nation’s energy industry.
Greece’s Energean is to supply as much as 23 billion cubic meters of natural gas from the Karish and Tanin fields off Israeli shores to Dalia Power Energies Ltd and Or Power Energies Ltd, an e-mailed statement said yesterday.
The cost is to be linked to the Israeli electricity market and underpinned by a floor price.
Energean has said it would sell to the Israeli market for less than what Israel Electric Corp — the state-run utility and biggest supplier of power — pays to the partners in Israel’s second-largest natural gas reservoir, Tamar.
Israel Electric paid on average US$5.22 per 28.3m3 of gas last year, according to Noble Energy Inc’s annual report.
Noble owns a major stake in and operates the Tamar field.
“The agreement is a substantial step toward bringing competition and cheaper energy to the market,” Energean chief executive officer Mathios Rigas said in the statement.
Energean is negotiating further contracts in the Israeli market and plans to submit a development plan for the Karish and Tanin field “in the next few weeks,” he added.
Establishing competition was the Israeli government’s main goal when it revised its regulatory policies governing the natural gas industry in 2015.
Noble and Israel’s Delek Group Ltd were forced to sell the smaller Karish and Tanin fields and reduce their holdings in Tamar in order to develop Leviathan, Israel’s largest gas reserve.
The Leviathan partners have already signed four contracts with local customers and might sell more.
Energean last year bought Karish and Tanin from Delek and Noble for about US$150 million and future royalties.
The Greek explorer said it would invest more than US$1 billion in development over the next few years, with the aim of pumping gas to clients by 2020.
INVESTOR RESILIENCE? An analyst said that despite near-term pressures, foreign investors tend to view NT dollar strength as a positive signal for valuation multiples Morgan Stanley has flagged a potential 10 percent revenue decline for Taiwan’s tech hardware sector this year, as a sharp appreciation of the New Taiwan dollar begins to dent the earnings power of major exporters. In what appears to be the first such warning from a major foreign brokerage, the US investment bank said the currency’s strength — fueled by foreign capital inflows and expectations of US interest rate cuts — is compressing profit margins for manufacturers with heavy exposure to US dollar-denominated revenues. The local currency has surged about 10 percent against the greenback over the past quarter and yesterday breached
MARKET FACTORS: Navitas Semiconductor Inc said that Powerchip is to take over from TSMC as its supplier of high-voltage gallium nitride chips Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday in a statement said that it would phase out its compound semiconductor gallium nitride (GaN) business over the next two years, citing market dynamics. The decision would not affect its financial targets announced previously, the world’s biggest contract chipmaker said. “We are working closely with our customers to ensure a smooth transition and remain committed to meeting their needs during this period,” it said. “Our focus continues to be on delivering sustained value to our partners and the market.” TSMC’s latest move came unexpectedly, as the chipmaker had said in its annual report that it has
Gudeng Precision Industrial Co (家登精密), the sole extreme ultraviolet pod supplier to Taiwan Semiconductor Manufacturing Co (台積電), yesterday said it has trimmed its revenue growth target for this year as US tariffs are likely to depress customer demand and weigh on the whole supply chain. Gudeng’s remarks came after the US on Monday notified 14 countries, including Japan and South Korea, of new tariff rates that are set to take effect on Aug. 1. Taiwan is still negotiating for a rate lower than the 32 percent “reciprocal” tariffs announced by the US in April, which it later postponed to today. The
SECURITY WARNING: The company possesses key 3-nanometer technology, and Taiwan should prevent it from being transferred to China, a lawmaker said The Ministry of Economic Affairs yesterday said it would conduct a “strict review” of any proposed acquisition of Taiwanese tech company Source Photonics Co (索爾思光電), following media reports that a Chinese firm was planning to buy the company in the Hsinchu Science Park (新竹科學園區). Local media reported that Suzhou Dongshan Precision Manufacturing Co (東山精密), China’s largest printed circuit board manufacturer, had announced plans to acquire Source Photonics for 5.9 billion yuan (US$823.1 million). The ministry said it has not received an application from Source Photonics and has formally notified the company that any buyout would constitute a change in its ownership structure. The
RSS