Delek Drops Amid Leviathan Antitrust Ruling Bets: Tel Aviv Mover

Delek Group Ltd. fell the most in more than nine months on investor concern the antitrust regulator may declare partners in Leviathan, Israel’s largest natural gas field, a monopoly.

The shares of Netanya, Israel-based Delek Group declined 3.8 percent, the biggest drop since May 29, to 961.7 shekels at the close in Tel Aviv. Units Delek Drilling-LP and Avner Oil Exploration LP, which have stakes in Leviathan, decreased 4.3 percent and 3.8 percent, respectively. The benchmark TA-25 Index increased for a third day, gaining 0.2 percent.

Israel’s Antitrust Authority is due to declare soon whether the partners, which also include Noble Energy Inc. and Ratio Oil Exploration 1992 LP, constitute a cartel, Globes business daily reported today. The regulator said in September 2011 it was studying the issue. Delek, Avner and Noble also hold stakes in Tamar, Israel’s second-largest natural gas field.

“In a worst-case scenario the regulator could force the partners in both the Leviathan and Tamar fields to sell their holdings in Leviathan,” Guil Bashan, an analyst at IBI-Israel Brokerage & Investments Ltd. in Tel Aviv, said today by phone. “This is an unlikely scenario, and most probably they will come to some sort of compromise. There will some be pressure on the shares until the uncertainty is removed.”

Mark Schon, a spokesman for the Israel Antitrust Authority, declined to comment on the Globes report.

Delek Group shares have advanced 47 percent in the past 12 months buoyed by the prospect of the gas flow starting from Tamar in the second quarter of the year and as 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 the partners. Noble discovered the Leviathan field in Israel’s deep waters in 2010, when it was the world’s largest find of its kind in a decade. It is estimated to hold 17 trillion cubic feet of natural gas.

Ratio shares dropped 5 percent, the most since Oct. 14, to 0.324 shekel. Clal Finance Batucha today cut its price targets on gas sector stocks to reflect changes in the tax treatment of the shares. It set a price target for Avner of 2.5 shekels, Delek Drilling of 13.7 shekels, and Ratio of 0.29 shekel.

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