Delek Surges as Tamar’s Gas Flow Boosts Outlook: Tel Aviv Mover

Delek Group Ltd. (DLEKG) climbed to the highest level in more than two years on investor bets the company will benefit from gas flow at the Tamar field and its U.S. unit.

The shares of Netanya, Israel-based Delek Group rose 2.85 percent to 982.5 shekels, the highest level since December 2010, at the close in Tel Aviv. The stock, up 47 percent in the past 12 months, has risen 7.6 percent in February, headed for a seventh month of gains. The benchmark TA-25 (TA-25) Index increased 0.5 percent, bring this month’s advance to 3.8%.

Delek Group owns stakes via Delek Drilling-LP (DEDRL) and Avner Oil Exploration LLP (AVNRL) in the offshore natural gas field that is scheduled to start production by the second quarter. OAO Gazprom (GAZP), the world’s biggest natural gas producer, said this week it’s seeking exclusive rights to export liquefied natural gas produced from Tamar. The shares of Delek Group’s unit, Delek US Holdings Inc. (DK), have almost tripled in the past 12 months amid higher U.S. refining margins.

“We are close to the start of the gas flow of Tamar, which is supposed to have a positive effect on Delek’s gas subsidiaries,” Guil Bashan, an analyst at IBI-Israel Brokerage & Investments Ltd. in Tel Aviv, said today by phone. “Delek US has risen tremendously in the past year because of the improved refining margins in the US.”

Woodside Petroleum Ltd., Australia’s second-largest oil and gas producer, agreed to pay as much as $2.3 billion for 30 percent of Leviathan from partners including Houston-based Noble Energy Inc. (NBL), as well as Delek Drilling and Avner. Refiners may continue to outperform amid positive long-term asset revaluation, Dahlman Rose & Co. LLC analyst Sam Margolin wrote in a note on Jan. 10. Delek Group indirectly holds a 53 percent stake in Brentwood, Tennessee-based Delek US.

Delek Drilling shares advanced 1.6 percent, bringing the 12-month gain to 13 percent. Avner rose 1 percent, taking its 12-month increase to 5.4 percent.

To contact the reporter on this story: Shoshanna Solomon in Tel Aviv at ssolomon22@bloomberg.net

To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net

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