Australia's Woodside balks on Israel's Leviathan field

Woodside Petroleum deal in Leviathan gas field off Israel's coast hits snag.
By Daniel J. Graeber Follow @dan_graeber Contact the Author   |   March 28, 2014 at 9:50 AM
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Australian energy company Woodside Petroluem said a February agreement to sign a deal to enter the Leviathan gas field off the Israeli coast was on hold.

Woodside said in a statement the parties to a memorandum of understanding -- Noble Energy Mediterranean Ltd, Delek Drilling, Avner Oil Exploration LP and Ratio Oil Exploration -- haven't settled the terms of a deal announced last month.

"Discussions continue with the parties and the Israeli government with a view to resolving the remaining issues and executing definitive agreements," the Australian company said in a statement Thursday.

The February arrangement would have granted Woodside a 25 percent stake in the field, one of the largest in the world.

The company balked over Israeli tax policy, saying its profits from Leviathan should be tax free. The Israeli government, however, said Woodside's stake should be seen as a capital investment and therefore subject to taxation.

Noble Energy estimates Leviathan holds as much as 18.9 trillion cubic feet of natural gas. Its operators said it could start commercial production by 2016.


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