In 2010, Delek and its partners discovered the the 21.4 TCF Leviathan field in Israeli waters, one of the world’s largest natural gas finds of the decade. This discovery was followed, in 2011, by the discovery of the 4.5 TCF Aphrodite field in Cypriot waters and several additional finds, giving Delek Group a total of 11 natural gas discoveries while confirming the vast hydrocarbon potential of the Levant Basin.
Following these major discoveries, Delek made a strategic decision to become a pure-play E&P company, and therefore to divest all of its non-E&P assets. To date, this process has generated USD 1.3 billion in cash, a sum that the company has redeployed to reduce its leverage and to fund further E&P activities. The sale of Delek’s remaining non-E&P assets, including its 52% ownership of Phoenix Holdings Ltd., an insurer, and its 50% holding in IDE Technologies, a provider of water treatment solutions, is in process.
In 2015, the company expanded its strategic focus to include international E&P markets identifying opportunities in the North Sea and North America. It acquired a 20% stake in Ithaca Energy, a North Sea oil and gas operator, and, in 2016, farmed in a 70% working interest in Block 7 off Eastern Newfoundland, Canada. In June 2017, Delek acquired the remaining shares of Ithaca, becoming its sole owner. This acquisition has given Delek a strong operational capability that it will utilize as it continues to expand its international activities. Delek continues to evaluate a variety of new international opportunities.
In August 2015,the Israeli government approved its Natural Gas Framework, the regulations that govern the future development of Israel’s offshore natural gas assets, and ratified it in May 2016, thereby bringing certainty to Israel’s E&P industry. The plan calls for Delek to: 1) sell its stake in the Tamar field within six years; 2) sell its stakes in the Tanin and Karish fields, which Delek has since effectuated; and 3) develop Delek Group’s entire 25.5% economic interest in Leviathan. To date, Delek has taken the steps necessary to comply with the Framework’s orders.
Delek’s goals for the future are: 1) to become an E&P pure play by divesting its remaining non-core assets; 2) to further develop the East Med natural gas hub, including the Leviathan, Tamar, and Aphrodite fields and associated infrastructure; 3) to deploy the operational capabilities achieved through the Ithaca Energy acquisition; and 4) to continue its expansion in the international E&P space.