Noble Energy sells interest in Israeli natural gas project

Noble Energy Inc. (NYSE: NBL) announced Tuesday morning that it has agreed to sell a 3% working interest in the Tamar field offshore of Israel to an Israeli partnership for a total of $369 million. The buyers are Harel Group, an insurance provider and pension manager, and the Israel Infrastructure Fund, an infrastructure private equity fund.

The sale values the Tamar field at approximately $12 billion, and the buyers have an option to purchase an additional 1% before the deal closes at the same valuation. The transaction is expected to close in the third quarter of this year.

Noble is selling 11% of its interest in the Tamar field as part of an agreement with the Israeli government and its recently passed Natural Gas Regulatory Framework. The framework agreement was approved in April after the country’s supreme court threw out an earlier deal promised pricing and regulatory stability for 10 years.

The company said it expects to sell the remaining 7% or 8% sales over the next three years. The Tamar field holds estimated natural gas resources of 10 trillion cubic feet. Noble will retain a 25% working interest in the Tamar field and continue as the field’s operator after the sales are completed.

The approved law requires only that the developers may be compensated for future changes in regulation. In April, Noble said that the new language was “an important milestone in creating a stable investment environment.”

Noble also operates the Leviathan field offshore of Israel. Leviathan holds more than double the natural gas resource of Tamar. Noble’s shares traded down more than 2% Tuesday morning, at $35.29 in a 52-week range of $23.77 to $40.98.

that