Newmed Energy Limited Partnership · TASE:NWMD
Newmed Energy Limited Partnership — Delek Drilling – Limited Partnership — Delek Group Investors Conference 2018
29 slides from Newmed Energy Limited Partnership's conference presentation, November 2018
Slide 1: Energizing the Eastern Med
Energizing the Eastern Med Yossi Abu - CEO November 2018 Delek Drilling – Energizing The Eastern Med
Slide 2: Disclaimer
Disclaimer This presentation was prepared by Delek Drilling – Limited Partnership (the “Partnership”), and is given to you only for the provision of concise information for the sake of convenience, and may not be copied or distributed to any other person. This presentation does not purport to be com
Slide 3: Contents
Contents ❑ Leviathan Development update ❑ Israel Gas Market ❑ Regional Markets ❑ Dolphinus + EMG Overview & Agreements – Midstream Solution ❑ Delek Drilling near term targets Delek Drilling – Energizing The Eastern Med 3
Slide 4: Leviathan Development Status Update
Leviathan Development Status Update 4
Slide 5: Leviathan Development on Time on Budget
Leviathan Development on Time on Budget ❑ Phase 1a development progressing ~67% completed ❑ Fabrication progress on the platform topsides, jacket, and the subsea equipment ❑ All building permits received or submitted ❑ More than 300km of subsea pipe placed (out of 513km) ❑ Export pipeline to Jordan
Slide 6: Project Development Visual
Project Development Visual Source : Leviathan operator (NBL) Delek Drilling – Energizing The Eastern Med 6
Slide 7: Israel’s Gas Demand Trends
Israel’s Gas Demand Trends Delek Drilling - Energizing The East Med 7
Slide 8: Growing Domestic Demand
Growing Domestic Demand Domestic natural gas consumption is in constant growth trend Q U A R T E R LY G A S S A L E S Demand vs Consumption 2018 * 2015 2016 2017 Tamar Sales 2018* 10.5 3.00 2.50 2.00 2.00 2.20 2.402.40 2.30 2.502.60 2.502.602.60 2.00 2.302.40 LNG imports 2018 0.5 bcm 1.50 1.80 1.00
Slide 9: Governmental Support- Growth Drivers
Governmental Support- Growth Drivers 2015 2016 2017 2018 2019 Energy Ministry Decision on Orot Decision on gas Coal Taxation Final Approval of vision of stop Rabin 1-4 shut- priority in dispatch implementation Government using oil fuels down model and coal by 2030 Gas Framework Instructions of Gas $
Slide 10: Long Term Demand Growth
Long Term Demand Growth Israel Expected Natural Gas Demand (BCM) Electricity Generation Mix 34.0 32.8 Gas Coal Renewable 31.9 31.0 2% 29.9 5% 8% 29.0 28.0 27.0 8% 26.2 21% 25.3 24.4 23.7 45% 22.8 22.0 21.1 20.3 19.5 18.7 18.0 15.4 14.0 84% 10.9 11.2 74% 53% 2018 2019 2020 2021 2022 2023 2024 2025 20
Slide 11: Delek Regional Strategy
Delek Regional Strategy Delek Drilling - Energizing The Eastern Med 11
Slide 12: Egyptian Gas Market
Egyptian Gas Market 12
Slide 13: Egypt - Natural Gas Resources Breakdown
Egypt - Natural Gas Resources Breakdown Gas resources breakdown by field or cluster of fields ▪ Several of the fields have stated production or are entering production: ▪ Zohr (21.5 TCF) ▪ West Nile Delta Fields (4.9 TCF) ▪ West Delta Deep Marine (2.3 TCF) 53.8 TCF ▪ Nooros (1.2 TCF) ▪ Atoll (1.5 TC
Slide 14: Natural Gas Production – until 2016
Natural Gas Production – until 2016 Delek Drilling – Energizing The Eastern Med 14
Slide 15: Natural Gas Production Outlook
Natural Gas Production Outlook New gas volumes have entered production in 2017-2018 ▪ Increased production is led by Zohr, West Nile Delta, Atoll and supported by other fields such as Nooros and WDDN ▪ With these new projects, domestic production is expected to reach 80 BCM in 2020 ▪ New gas supply
Slide 16: Natural Gas Demand – Continues to Grow
Natural Gas Demand – Continues to Grow Demand recovers strongly with the increase in supply, 10% average annual growth from 2016-2020 Delek Drilling – Energizing The Eastern Med 16
Slide 17: Egypt – Long Term Supply Demand Imbalance
Egypt – Long Term Supply Demand Imbalance +20 BCM of LNG facilities* *The demand shown does not include the Egyptian LNG facilities at Damietta and Idku Source: Wood Mackenzie Various International Research Department Reconfirm Long-Term Gas Deficit Delek Drilling – Energizing The Eastern Med 17
Slide 18: Dolphinus GSPA’s Details
Dolphinus GSPA’s Details Leviathan : ❑ Annual supply of 3.5 BCM/y (with TOP level agreed) ❑ Total Contract Quantities : 32 BCM ❑ Estimated revenue income: $7.5 Billion Contract price Tamar : based on a Brent linked ❑ Annual supply begin on an Interruptible base with seller option to formula convert
Slide 19: Infrastructure Solutions
Infrastructure Solutions EMG Pipeline Pan-Arabic Pipeline Existing Infrastructure Under construction Future potential pipeline Delek Drilling – Energizing The Eastern Med 19
Slide 20: EMG - Transaction Goals
EMG - Transaction Goals ❑ We aim to enable transportation of gas from Tamar and Leviathan to Egypt in order to realize the Dolphinus GSPAs ❑ Our main value from the transaction is elevating the upstream sales of both Tamar and Leviathan ❑ Securing stable and continuous operation of the EMG pipeline
Slide 21: EMG Pipeline Overview
EMG Pipeline Overview ❑ Asset Overview: ▪ Pipeline: 26” diameter, 89 km (85.4 km subsea), from Ashkelon to (Israel) El-Arish (Egypt) ▪ El-Arish Station: pipeline inlet, Siemens compressors, connection to the 36” Trans-Sinai gas pipeline ▪ Ashkelon Terminal: connection to the Israeli Natural Gas Tran
Slide 22: Transaction
Transaction Delek Noble East Gas 25% 25% 50% EMED Merhav Merhav Merhav EGI – EMG (mnf) Ltd. Ampal Grp. EMED (Delek 25%, Ampal LP Noble 25%, EastLP Gas 50%) East Gas PTT EGPC MGPC 8.2% 8.2% 39% 8.6% 12% 9% 25% 10% 17% 28% EMG “CLOA” 39% 100% Tolling Fee Delek Drilling – Energizing The Eastern Med 22
Slide 23: Gas / Funds Flow
Gas / Funds Flow Capacity, Lease & Operatorship Agreement between EMED and EMG, in which EMG will grant EMED the exclusive right to lease and operate the EMG Pipeline for the entire term of the Dolphinus Agreements, with an option to extend the agreement. According to this agreement, the costs requi
Slide 24: Gas Flow to Egypt – Initial Stage
Gas Flow to Egypt – Initial Stage Leviathan Tamar Ashdod Ashqelon Delek Drilling – Energizing The Eastern Med 24
Slide 25: Gas Flow to Egypt – Hot Tap
Gas Flow to Egypt – Hot Tap ❑ Hot Tap is the ability to safely tie into a Leviathan Tamar pressurized system, while it is on stream and under pressure ❑ Both Tamar & Leviathan are examining Hot Tap connection to the EMG pipeline for infrastructure flow Ashdod optimization Ashqelon Delek Drilling – E
Slide 26: Jordan NEPCO – Ideal Export Offtaker
Jordan NEPCO – Ideal Export Offtaker An anchor contract for Leviathan phase-1 development ❑ Electricity demand has been growing at an average rate of 6.0% per year (2005-2017) ❑ natural gas is the basis of 80-85% of energy production (2016-2017) ❑ Natural gas demand is estimated at 5.0 to 5.2 BCM in
Slide 27: Egypt LNG Terminals
Egypt LNG Terminals Two existing LNG liquefaction (export) terminals – ELNG and Damietta Feed Gas ▪ LNG liquefaction terminals for LNG export – Number Nominal Volumes – Terminal Owners Plant Operating in very low-utilization rate due to of Trains Capacity Nominal Capacity lack of available feed gas
Slide 28: Near Term Targets
Near Term Targets Leviathan EMG Activity & Jacket & transaction Leviathan First Gas : Platform closing Leviathan Operation : installation Israel + Jordan + Egypt Phase 1B Tamar FID 22% WI Tamar – sale down Dolphinus Leviathan flow test & Aphrodite Leviathan deep refinancing marketing + FID sales exp
Slide 29: Thank you
Thank you Delek Drilling – Energizing The Eastern Med 29
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