Israeli player sees ‘enormous potential’ for gas & oil off Morocco
Israel’s NewMed Energy, formerly known as Delek Drilling, has inked deals with Adarco Energy Limited and Morocco’s National Office of Hydrocarbons and Mines (ONHYM) for natural gas and oil exploration and production activities in a license located off the coast of Morocco in the Atlantic Ocean.
Based on the agreement signed on 6 December 2022, NewMed Energy and Adarco will each hold a 37.5 per cent interest in the Boujdour Atlantique license, which is valid for eight years. On the other hand, ONHYM will hold the remaining 25 per cent interest in this license.
Commenting on this, Yossi Abu, CEO of NewMed Energy, remarked: “From one day to the next we are expanding our international operations and becoming a global body in every respect. We identified enormous potential in Morocco.”
During the exploration period, NewMed and Adarco are expected to cover, in addition to their relative share of the costs, the costs of ONHYM’s share, in accordance with the regulation in Morocco.
The company further elaborated that these agreements are contingent on the receipt of approval from Morocco’s Minister of Energy Transition and Sustainable Development and the Minister of Finance along with the shareholders’ approval during the general meeting. In the event that this approval is not obtained within 90 days of the signing date, these agreements will be rescinded.
Located offshore in the south of the Moroccan exclusive economic zone, the Boujdour Atlantique license covers an area of approximately 33,812 km2. This agreement grants the right to conduct exploration for oil and natural gas in the area of the block for a term of eight years in total while the initial term is 2.5 years.
The license can be extended in a case where hydrocarbons are found and an examination of economic viability is required. The first extension – subject to the firm’s decision and subject to the commitment to the second-term work plan – would be for two years. In addition, a second extension – subject to the company’s decision and commitment to the third-term work plan – would be for 3.5 years.
Regarding NewMed Energy’s recent activities, it is worth noting that the firm entered into a merger agreement with the UK-based Capricorn Energy, previously known as Cairn Energy.
In accordance with this, the Capricorn board unanimously decided to withdraw its intention to recommend the Tullow combination, which was announced back in June 2022.