Israel's Shapir Weighing Bid for Natural Gas License Tender

  • Company may need to find a partner with energy expertise
  • Shapir shares have outperformed global peers in last year

Shapir Engineering and Industry Ltd., which develops residential, commercial and industrial construction projects in Israel, is considering expanding its operations into offshore energy exploration.

The Petach Tikvah, Israel-based company is mulling a bid to drill for oil and gas in the 24 new blocks opened for exploration in the country’s economic waters, a company spokeswoman told Bloomberg. 

Israeli waters hold an estimated 2,200 billion cubic meters of undiscovered gas, about two and a half times the amount contained in known fields, according to a report by French consultant Beicip-Franlab SA. Israel opened the fields for exploration in November and is trying to attract large energy explorers amid skepticism in the industry that major players will come to Israel after years of regulatory hurdles. 

Shapir, which does not have any energy expertise, may need to find a partner to move ahead, much like Delek Group Ltd.’s partnership with Noble Energy Inc. in Israel’s two biggest natural gas finds, the Leviathan and Tamar reservoirs.

Shapir shares have risen 62 percent in the last 12 months, ahead of the 23 percent average of global peers compiled by Bloomberg. The company is controlled by the Shapira family and is involved in key projects in Israel, including construction of a section of the Route 6 national highway and the new Haifa port.

The stock rose as much as 1.7 percent, before paring gains to 1.2 percent to 9.725 shekels at 11:35 a.m. Shapir was among the best performers on Israel’s TA-125 Index, which was up 0.2 percent.

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