Israeli partner of ATP still examining bankruptcy implications


Israeli partner of ATP still examining bankruptcy implications


Isramco Negev Partnership said Sunday that it is "examining the legal and financial implications" of its partner Houston based ATP filing for bankruptcy protection last week.

Isramco and ATP are partners in Israel's offshore Shimshon natural gas field, which could contain up to 2.3 tcf. Isramco and its affiliates, own 60% of the Shimshon field, and ATP owns 40%. Successful production tests were completed at the field earlier this month. Isramco did not release any further details on possible consequences of the bankruptcy on the Shimshon project.

ATP filed for Chapter 11 bankruptcy last Friday and has blamed its financial collapse on the ban on deepwater drilling in the Gulf of Mexico following the deepwater horizon disaster in 2010 off the coast of New Orleans. It is one of the few foreign energy companies involved in Israel's recent natural gas and oil discoveries.

Private sector and government officials are eager to start production from the fields, the largest of which contains 16 tcf of gas, to relieve Israel's current natural gas shortage, which threatens to result in electrical grid rolling blackouts this summer.

Israel's gas supply from Egypt has become unreliable, after several attacks on the pipeline in Egypt's Sinai Peninsula following the fall of former president Hosni Mubarak's regime. This has forced Israel's power companies to rely on more expensive forms of energy, raising electricity prices.

Dow Jones Newswires

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