BP and Abu Dhabi’s state oil giant on Tuesday offered to acquire 50% of Israeli offshore natural gas producer NewMed Energy for around $2 billion, making their entry into Israel’s growing energy sector.
The offer would involve acquiring NewMed’s free floating shares and taking the company private. BP shares gained 2% by 0810 GMT while NewMed shares were up around 30%.
Abu Dhabi National Oil Co (ADNOC) and BP said they intend to form a new joint venture as part of the deal that will be “focused on gas development in international areas of mutual interest including the East Mediterranean.”
NewMed is the largest stakeholder in the giant Leviathan offshore field, operated by Chevron, which produces 12 bcm of gas that are supplied to Israel, Egypt and Jordan.
NewMed and its partners plan to nearly double Leviathan’s production to 21 to 24 bcm by 2027 are also exploring plans for a liquefied natural gas (LNG) terminal to further boost exports, Chief Executive Officer Yossi Abu told Reuters.