Delek Drilling to sell $2.25 bln of bonds to finance Leviathan gas field

Israel's Delek Drilling plans to raise $2.25 billion in an international bond offering to help it finance development of the Leviathan natural gas project off Israel's Mediterranean coast.

By Steven Scheer

JERUSALEM, July 27 (Reuters) - Israel's Delek Drilling DEDRp.TA plans to raise $2.25 billion in an international bond offering to help it finance development of the Leviathan natural gas project off Israel's Mediterranean coast.

The issue, expected to be completed in coming weeks, will be led by JP Morgan and HSBC, Delek said on Monday, adding it will pledge its rights in the Leviathan project in favour of the bondholders.

Delek Drilling, controlled by conglomerate Delek Group DLEKG.TA, said that after the offering it would buy back up to $50 million of its existing bonds, including those used to finance the smaller Tamar gas project.

Israel’s $3.6 billion Leviathan field - co-owned by Delek, Texas-based Noble Energy NBL.O and Ratio Oil RATIp.TA - started production in late 2019 and is already supplying gas to Israel, Egypt and Jordan.

Last week Chevron Corp CVX.N said it would buy Noble for about $5 billion in stock.

A roadshow for the bonds, which will be divided into four series expected to mature in 2023, 2025, 2027 and 2030, will be launched in coming days.

(Reporting by Steven Scheer Editing by Tova Cohen and David Holmes)

((steven.scheer@thomsonreuters.com; +972 2 632 2210; Reuters Messaging: steven.scheer.thomsonreuters.com@reuters.net; Twitter: @StevenMScheer))

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