Delek Drilling and Avner Oil and Gas both posted a sharp rise in second-quarter net profit on Wednesday as the offshore Tamar natural gas field started production. Both Delek Group subsidiaries own 15.6% stakes in the project and focus on exploration and production.
In the quarter, Delek Drilling's profits climbed more than four times to $16.6 million; for Avner, the surge was six and a half times to $11.7 million.
In late-afternoon trading, Delek Drilling shares were up 1.3%. Avner was up 1.8%.
"The start of production at the Tamar field is already seen in the financial results of Delek Drilling and Avner Oil and Gas,” said Delek Drilling CEO and Avner chairman Gideon Tadmor. “The increase in revenues and profits is mainly due to the first-time recognition of revenues from the Tamar project and the recording of profits from the leasing of oil and gas assets.”
For the first half, both companies more than doubled net profit - Delek Drilling to $18.2 million and Avner to $11.8 million. Revenues after deducting for royalty payments also climbed in the half. For Delek Drilling they rose 92% to $71.7 million, for Avner 89% to $67.5 million.
Also Wednesday, Delek and Avner said two reservoirs near Tamar contain about 0.7 trillion cubic feet of natural gas.
The companies cited the best estimate for unrisked gross prospective gas resources provided by Texas-based consultants Netherland, Sewell & Associates.
They said they have not yet made a decision as to whether they will develop the reservoirs in the Tamar Southwest prospect.
Texas-based Noble Energy owns 36% of Tamar, while Delek Drilling and Avner Oil and Gas , both subsidiaries of Delek Group, hold 15.625% each.
Isramco Negev holds 28.75% and Dor 4%.
Two of the world’s largest offshore fields from the past decade were found in Israeli waters. The first of the fields - Tamar, with an estimated 10 trillion cubic feet of gas - came online in late March.
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