Israel's Delek Group has made a US$524 million offer for UK independent explorer and producer Ithaca Energy.
The offer, a 12% premium on Ithaca's last closing price on the Toronto Stock Exchange, would see Delek take over Ithaca's UK North Sea portfolio, including the Greater Stella Area (GSA) development, a floating production project due on stream later this month.
This morning, Ithaca said good progress was being made on GSA, which had been delayed at the yard, where the FPF-1 floating production unit was being overhauled, and at sea, due to weather and electrical issues. Ithaca said progress completing remedial work on electrical junction boxes was good and that start-up was expected for later this month.
Delek, which is a partner with Noble Energy on the massive Leviathan and Tamar fields offshore Israel, says the move is part of its strategy to expand its international energy operations. Delek already holds 19.7% interest in Ithaca. Last year, the firm attempted to acquire a 20% stake in EnQuest's Kraken development, but the deal fell through.
Delek's CEO and President Asaf Bartfeld said: "Today, we are taking another significant step which, if successful, will firmly establish Delek Group as a global exploration and production company, with international oil and gas assets and strong operational capabilities. The Ithaca transaction will substantially strengthen our international operational arm, and is a synergistic step to our existing activities. We believe Ithaca will contribute to our continued growth and we look forward to reinforcing and building on our status in international markets."
Ithaca also has stakes in the producing Heather and Dons fields, operated by EnQuest, stakes in the Cook and Pierce fields, both subsea to floating production developments, and the Topaz subsea tieback. Ithaca also operates the Causeway subsea tieback.
The firm has exploration assets including operatorship of the Harrier and Hurricane discoveries, and a stake in the BP operated Vorlich find, all of which are close to GSA.
Image: The FPF-1 heading out to sea. Image from Ithaca Energy.
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