Israeli billionaire eyes Victorian gas

AN Israeli shipping and real estate billionaire has joined Kerry Stokes in targeting Victoria’s gas sector.

OG Energy, a company backed by business magnate Eyal Ofer, has agreed to buy a 40 per cent stake in Beach Energy’s Otway Basin plots off the Victorian coast for $344 million.

Beach is 25 per cent owned by Mr Stokes’ Seven Group.

The deal is scheduled to be completed by the end of the financial year.

Mr Ofer, who was born in Israel but lives in Monaco, said he was interested in expanding his presence in the nation’s energy sector. “With this acquisition, we have acquired a cornerstone producing asset around which we intend to continue to build the portfolio and grow our presence in Australia and the region,” Mr Ofer said.

“We are excited at what the future holds.”

Mr Ofer already owns oil and gas assets in New Zealand.

Beach acquired the Otway assets as part of its $1.6 billion purchase of Origin Energy’s Lattice business at the start of the year.

The assets include the Otway gas plant, the Geographe, Thylacine, Halladale, Speculant and Black Watch fields, as well as Enterprise and Artisan exploration targets.

Beach chief executive Matt Kay said the deal gave the company “a fully-aligned partner” to support the rapid exploration and development of its offshore Victorian acreage.

“Securing an excellent development partner for the Otway gas fields is a pivotal step towards creating new supply to Australia’s east coast gas market,” Mr Kay said.

The sale has cut the production forecast given by Beach last week at an investor briefing.

Beach now says it will produce between 25 million and 27 million barrels of oil equivalent, down from its earlier guidance of 26 million to 28 million barrels of oil equivalent.

Its forecast earnings before interest, tax, depreciation and amortisation has slipped to between $1.05 billion and $1.15 billion, down from $1.1 billion to $1.2 billion.

Beach has also lowered its production target for the 2023 financial year to 30 million to 36 million barrels of oil equivalent, down from 34 million to 40 million barrels of oil equivalent.

Mr Ofer owns international real estate firm Global Holdings and shipping company Zodiac Group. He is worth $US9.4 billion ($13.3 billion), according to Forbes.

Shares in Beach tumbled yesterday as the price paid by OG Energy fell short of what analysts had expected.