--Discovery brings Noble's natural-gas discoveries in the region
to 33 trillion cubic feet
--Noble could decide to build LNG plant to export the gas from
Cyprus
--Noble ignored Turkish warning that it would drill in the
region
(Adds analyst comment, other information, in the first, second,
fifth and sixth paragraphs.)
Noble Energy Inc. (NBL) said it discovered up to eight trillion
cubic feet of natural gas in the waters near Cyprus, building on a
string of recent successes in the area known as the greater Levant
basin.
The oil-and-gas explorer and its partners have now found five
discoveries in the basin, which is off the coasts of Cyprus,
Israel, Lebanon and Syria. The estimated 33 trillion cubic feet of
newly found natural gas could help to make the area a major
natural-gas exporter.
Noble's newest well was drilled at a water depth of about one
mile and about 3 1/2 miles into the ocean floor. Noble said there
could be about five trillion to eight trillion cubic feet of
natural gas in the reservoir.
Noble Energy, based in Houston, operates the well with a 70%
working interest. Israel-based Delek Drilling LP (DEDR.L.TV) and
Avner Oil Exploration LP (AVOGF, AVNR.L.TV) will each have 15%,
subject to final approval by the government of Cyprus. Both
companies are part of Delek Group Ltd. (DGRLY, DLEKG.TV).
The newest discovery may support Noble's establishing a
liquefied-natural-gas, or LNG, facility to ship the commodity out
into global markets. LNG plants, which chill natural gas into a
liquid state for loading onto ships, are hugely expensive, but the
size of Noble's discoveries and the area's coastal location could
make the venture profitable, said Simmons Co. analyst Jeff
Dietert.
"While an LNG facility would take many years to develop, it
would likely yield significantly higher netbacks," Dietert
said.
The drilling off Cyprus ignored Turkish warnings that it would
retaliate by launching its own explorations in the area. Meanwhile,
Noble has already reported large natural-gas reserves at two
offshore Israeli fields.
In October, Noble posted a surge in third-quarter earnings,
thanks to climbing oil and gas prices.
Its shares were off 0.3% at $95.32 in recent trading. As of
Tuesday's close, the stock was up 11% year to date.
-By Ben Fox Rubin, Dow Jones Newswires; 212-416-3108;
ben.rubin@dowjones.com
-By Ben Lefebvre, Dow Jones Newswires; 713-547-9201;
ben.lefebvre@dowjones.com