Delek has announced plans to sell its 9.25% stake in Tamar and Dalit fields, offshore Israel, to Tamar Petroleum.
Under the sale, Tamar Petroleum will provide securities to the public in equity and bonds that will be registered on the Tel Aviv Stock Exchange (TASE) for trading.
Funds raised through the offering will be used by Tamar Petroleum to buy the rights in the two fields.
Earnings combined with sales in the fields will be used by the company to repay bonds and distribute profits, reported Offshoreenergytoday.com.
Globes reported that Delek has started a $650m bond on the TASE in Tamar Petroleum. If this move is successful, then Tamar Petroleum will offer shares to the public in around 14 days.
The divestment is a part of the agreement with the Israeli authorities, which required Delek to divest its 31.3% equity in Tamar to bolster competition to the Israeli gas sector where the company currently holds a monopoly.
Alongside Tamar, Leviathan is another gas producing field in which Delek serves as a partner. Leviathan is located in the Mediterranean Sea and operated by the US firm Noble Energy.
In 2016, Noble Energy divested a 3% interest in Tamar field to Harel Group under a deal with Israeli regulatory authorities to cut down its stake in the field to 25%. This deal carried a value of $369m.