Delek Group becomes major shareholder in operator Ithaca Energy

Offshore staff

TEL AVIV, IsraelDelek Group has become the largest shareholder in Aberdeen-based operator Ithaca Energy, signing a strategic agreement to invest in the company.

Ithaca’s primary focus is in the North Sea. It is a partner in 11 producing oil and gas fields, three of which it acts as the operator. One of its operatorships is what Delek termed Ithaca’s “key asset,” Greater Stella Area, which has been in development for several years. Located in the central North Sea, the Greater Stella Area is comprised of the Stella and Harrier oil and gas condensate fields. Ithaca said that Greater Stella is surrounded by numerous producing fields and undeveloped discoveries, with Total, Shell, ConocoPhillips, BP, and Talisman all operating infrastructure in the area. It carries a 54.66% working interest in the Greater Stella Area, partnering with Dyas (25.34%) and Petrofac (20%).

At the time of the agreement, Ithaca has a market value of $223 million and shareholders’ equity of $861 million. Delek Group will hold approximately 20% of Ithaca and will be entitled to two places on its board of directors as well as representation on the various board committees.

Under the terms of the transaction, Delek Group will receive a private allocation of around 20% of the company’s share capital at a price of 1.05 per share cash available for distribution in return for an overall investment of $66 million in the company. Its investment in Ithaca will be financed from the group’s own resources. Delek is not limited in increasing its holdings in Ithaca, and intends to examine such an increase.

Delek Group has announced in the past year that it intends to focus on the international energy sector by identifying investment opportunities, with the emphasis on operators synergistic with the group’s existing operations.

“I am convinced that together with the existing management we will be able to continue to lead the company to significant  additional achievements in the E&P field,” Asi Bartfeld, CEO of Delek Group, said. “For us this is a first and welcome step in extending our operations and strengthening our standing in the international oil and gas exploration and production sector. We intend to continue to take advantage of existing opportunities in the markets and to examine further strategic investments in international companies in the energy field.”

Beyond its producing assets, Ithaca lists two future developments in the works, both with EnQuest-operated oil discoveries. It holds a 55% working interest in the SW Heather discovery in the northern North Sea. Additionally, it holds a 10% working interest in the Scolty Area, comprised of the Scolty and Crathes discoveries, in Moray Firth.

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