Delek Group: Signing of an Agreement for Granting the Right to Sell Noble’s Interests in The 364/"Alon A" and 366/"Alon C" Petroleum Licenses
OREANDA-NEWS. Delek Group (TASE: DLEKG, US ADR: DGRLY) (“the Company”) announces that attached below is an Immediate Report of Avner Oil Exploration Limited Partnershipss and Delek Drilling Limited Partnerships (each of them) ("the Partnerships") concerning the signing of an agreement for granting the right to sell and Noble Energy Mediterranean Ltd. interests in the 364/"Alon A" and 366/"Alon C" Petroleum Licenses.
The Partnerships hereby respectfully notifies as follows:
Further to the immediate report dated August 17, 2015 (reference number 2015-01-097755) regarding the government’s approval, subject to the granting of an exemption, pursuant to article 52 of the Antitrust Law 5748-1988 (hereinafter: "Article 52"), of the gas framework mentioned in the aforementioned report (hereinafter: the "Framework"), and in order to prepare for the implementation of the Framework and to enable an efficient sale process of the "Karish" and "Tanin" reservoirs which are located within the 364/"Alon A" and 366/"Alon C" Licenses, respectively (hereinafter: "Karish" and "Tanin", and collectively: the "Licenses"), an agreement was signed (hereinafter: the "Agreement") on November 12, 2015, between the Partnerships and Noble Energy Mediterranean Ltd. (hereinafter: "Noble"), pursuant to which Noble will grant the Partnerships the right to sell half of Noble’s interests in the Licenses, the principles of which are as follows:
- Noble will grant the Partnerships, on an exclusive and irrevocable basis, the right to sell half of its interests (23.5295%) in the Licenses (hereinafter: the "Transferred Interests").
- In consideration for granting the right to sell the Transferred Interests and in consideration for the Transferred Interests, each Partnership will pay Noble a total amount of approx. 33.568 million U.S. Dollars on the date of fulfillment of the conditions mentioned in section e) below (hereinafter: the "Consideration").
- Noble shall not be entitled to any additional consideration for the sale of the Transferred Interests to a third party other than the aforementioned Consideration, irrespective of the amount that will be received by the Partnerships from the third party for the Transferred Interests.
- From the date of payment of the Consideration by the Partnerships to Noble, all expenditures with respect to the Transferred Interests shall be paid by the Partnerships. It is emphasized that as of this date, there are no additional significant investments expected for the Licenses, until the sale of the interests to a third party.
- The Agreement is contingent on receipt of final and unconditional approval of the Framework (including the granting of an exemption pursuant to Article 52) and receipt of the approval of the meeting of the Partnerships' unit holders. It should be noted that on the date of signing the Agreement, Delek Group Ltd., Delek Energy Systems Ltd. and the Partnerships provided Noble with an undertaking to vote in favor of the proposed resolution for the approval of the Agreement (and any related resolutions) at the general meeting of the holders of the participation units.
- In the event that the final and unconditional approval of the Framework is not granted (including the granting of an exemption pursuant to Article 52) within 75 days from the date of signing the Agreement, each party shall have the right to terminate the Agreement by giving 7 days prior written notice to the other party.
- In the event that the approval of the meeting of the holders of the Partnerships' participation units is not received for this Agreement within 35 days from the date of final approval of the Framework, the Partnerships may transfer its rights and obligations pursuant to the Agreement within 15 days to an affiliate of the Partnerships (an entity that controls the Partnerships, is controlled by the Partnerships or is controlled by another person that also controls the Partnerships1). In the event that the Partnerships do not transfer its rights to an affiliate as abovementioned, each Party may terminate the Agreement by written notice. In the event of termination of the Agreement as aforesaid, each Partnership has undertaken to pay Noble a breakup fee in the amount of 1.5 million U.S. Dollars.
In view of the fact that the engagement in the Agreement may be deemed as expansion of the Partnerships’ objects which are specified in Section 5 of the limited partnerships agreement of July 1, 1993 (as amended from time to time), and in view of the fact that the Partnerships requires financing sources to perform its undertakings according to the Agreement, the Agreement will be presented for the approval of the meeting of the Partnerships’ unit holders in a special resolution (within the meaning thereof in the trust agreement of July 1, 1993 (as amended from time to time).
It is noted that concurrently with the Partnerships’ engagement in the Agreement, Avner and Delek Drilling (each Partnership) engaged with Noble in an identical agreement to the Agreement, which is also subject to the approval of the meeting of Avner’s and Delek Drilling’s unit holders by the majority stated above. However, it is emphasized that each Partnership’s engagement in the Agreement with Noble as specified herein is not dependent on each other’s engagement in the agreement with Noble as specified above and vice versa.
Warning regarding forward-looking information: The Partnerships’ estimate that no investments in Karish and Tanin are expected until the sale of the rights to a third party, constitute forward-looking information, within the meaning thereof in the Securities Law, 5728-1968, which there is no certainty will materialize, in whole or in part, and which may materialize in a materially different manner, due to various factors including as a result of changes in the Framework and/or operating and technical conditions in Karish and Tanin and/or regulatory changes etc.
The partners in the 364/"Alon A" and 366/"Alon C" Licenses and their holding rates are as follows:
Noble Energy Mediterranean Ltd. 47.059%
Avner Oil Exploration - Limited Partnerships 26.4705%
Delek Drilling – Limited Partnerships 26.4705%
This is a convenience translation of the original HEBREW immediate report to the Tel Aviv Stock Exchange by the Company on November 15, 2015.
1 "Control" means the direct or indirect ownership of 50% or more of the voting rights or equity in a company, and with respect to an entity that is a partnerships, control means the general partner or limited partner of the partnerships or any company or entity that owns, directly or indirectly, 50% or more of the voting rights or equity in the general partner or the limited partner of the partnerships.
About The Delek Group
The Delek Group, Israel's dominant integrated energy company, is the pioneering leader of the natural gas exploration and production activities that are transforming the Eastern Mediterranean's Levant Basin into one of the energy industry's most promising emerging regions. Having discovered Tamar and Leviathan, two of the world's largest natural gas finds since 2000, Delek and its partners are now developing a balanced, world-class portfolio of exploration, development and production assets with total gross natural gas resources discovered since 2009 of approximately 40 TCF.
In addition, Delek Group has a number of assets in downstream energy, water desalination, and in the finance sector.
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