Delek Drilling Limited Partnership and Avner Oil Exploration – Limited Partnership and the other partners in licenses 349/Rachel and 350/Amit signed a natural gas supply agreement with the PPGC. According to the agreement PPGC will buy the gas for power plant operational needs which the company plans to build near Jenin in the northern West Bank.
Under the deal, the sellers committed to supply natural gas to PPGC in the total scope of 4.75 BCM.
The period of the supply agreement will start from the beginning of the flow of gas from the Leviathan Project and shall end after 20 years, or at the date that PPGC shall have purchased the overall contractual amount.
The price of gas determined in supply agreement will be linked to Brent Crude prices, and includes “a floor price”.
The sellers estimate that the aggregate level of revenues from the sale of natural gas to PPGC (at a ratio of 100% of the rights in the Leviathan Project) during the supply period (and based on an evaluation by the Leviathan partners regarding the price and quantity of natural gas which will be purchased during the Supply Period), is likely to aggregate to approximately US$ 1.2 billion.
[mappress] LNG World News Staff, January 6, 2013