Israeli Tamar Partners Agree New Gas Sales Terms

Chevron and the other companies developing the Tamar gas field off Israel have reached a preliminary settlement on the marketing of its production, after a disagreement over sales arrangements last year.

Under a memorandum of understanding (MoU), each partner can market its share of Tamar's gas separately, although joint marketing arrangements are still an option, Israel's Delek Drilling said on February 1. The group aims to reach a binding agreement based on the MoU by February 17, Delek said.

Tamar was brought on stream in 2013. Delek has a 22% interest in the field, while operator Chevron has 25%, having bought Noble Energy in October last year. The other partners are Isramco (28.75%), Tamar Petroleum (16.75%), Dor Gas (4%) and Everest (3.5%).

A dispute broke out last year, when some of Tamar's partners accused Noble and Delek of monopolistic behaviour, by trying to stall the amendment of a sales agreement with state-owned Israel Electric Corp (IEC). They argued that the pair were trying to prevent Tamar's gas from competing with supplies from Israel's larger Leviathan field, which they also control. Leviathan was brought on stream at the end of 2019.

Israel's competition authority ruled in September that Noble and Delek could not block the marketing decisions of their partners. The other shareholders then adjusted the supply deal with IEC, to include volumes beyond the take-or-pay requirement at a lower price.

The settlement deal means any partner can market gas beyond its share of output if no other partners have marketed its share on the same day. The MoU has been sent to the competition authority for approval.