Noble Energy Inc. (NYSE: NBL) has a farm-out agreement for a portion of its interest in Block 12 offshore Cyprus with BG International. BG is acquiring a 35% interest in Block 12, which includes the Aphrodite natural gas discovery, for total cash consideration of $165 million.
Aphrodite, discovered in 2011, has gross mean natural gas resources of approximately four trillion cubic feet. The transaction has an effective date of April 1, and is expected to close before the end of 2015. Noble Energy will maintain operatorship of Block 12 with a 35% interest.
Analysts with Cowen and Co. commented, “Noble partnering with BG on Block 12 adds BG's world-class LNG expertise to Noble's large Mediterranean gas discoveries. We give no value to Noble's Cyprus Aphrodite discovery but now we see ~$2/sh upside given BG's strong infrastructure in Egypt. We would expect Aphrodite to be developed with a start date after 2020.”
In addition to this transaction, Noble Energy announced the sale of its 47% interest in the Alon A and Alon C licenses offshore Israel, which include the Tanin and Karish fields, to the Delek Group for a total deal value of $73 million. The divestment of interest in these assets is a step in fulfilling Noble Energy's obligations under the recently approved regulatory framework in Israel and will simplify the ultimate sale of Tanin and Karish to a third party.
Completion of both transactions is subject to certain regulatory approvals, as well as customary closing conditions and adjustments.