Noble Energy, Inc. (NYSE: NBL) has announced that the parties have agreed to terminate the non-binding memorandum of understanding regarding the sale of interest in the Leviathan licenses, offshore Israel, to Woodside Petroleum. Following termination of the agreement, working interests in the Leviathan Project remain as follows: Noble Energy as operator (39.66 percent), Delek Drilling (22.67 percent), Avner Oil Exploration (22.67 percent), and Ratio Oil Exploration (15 percent).
Charles D. Davidson, Noble Energy's Chairman and CEO, commented, "The plans for development of the Leviathan discovery have significantly changed since we began the search for a partner approximately two years ago. Perhaps the most dramatic changes have been associated with the growth in the regional markets. The emergence of these regional markets, which are accessible through pipeline outlet, has pushed the need for LNG into a later phase of development versus our earlier plans. While we have not been able to reach a mutually acceptable agreement with Woodside, we continue to move forward with our partners and the Israel government with plans to develop this world-class asset for the benefit of all stakeholders."
Significant progress has been made on the development of the Leviathan field, following approval of Israel's natural gas export policy, an agreement with Israel's Anti-trust Authority, and receipt of the Development and Production Leases for Leviathan. Noble Energy is targeting to sanction the initial phase of development at Leviathan by the end of 2014, with first production from the field currently planned for late 2017.
The initial development phase is planned to be a 1.6 billion cubic feet per day floating, production, storage and offloading (FPSO) system, to provide natural gas into Israel and surrounding regional markets. Front-end engineering and design studies are ongoing for the second phase of development at Leviathan, which is anticipated to be a floating, liquefied natural gas (FLNG) production system.
The Leviathan Project is located offshore Israel in approximately 5,550 feet of water. It has an estimated 19 trillion cubic feet of discovered natural gas resources.
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