A United Arab Emirates sovereign wealth fund plans to buy a stake in an Israeli natural-gas field for as much as US$1.1 billion, in what would be the biggest business deal since the nations normalized ties last year.
Abu Dhabi’s Mubadala Investment, a fund with US$232 billion of assets, signed a memorandum of understanding to buy Delek Drilling LP’s 22% stake in the Tamar offshore field. Mubadala is carrying out due diligence, according to a person familiar with the matter.
“If finalized, the transaction will be the largest commercial agreement” since the signing of the Abraham Accords, Delek said in a statement.
The deal, if finalized, would be among the most significant developments since Israel and the United Arab Emirates agreed to normalise ties last year.
The Tamar gas field is one of Israel’s primary energy sources and is able to produce 11 billion cubic meters of gas each year. That is enough to cover much of the Israeli market as well as exports to Egypt and Jordan.
Delek Drilling CEO Yossi Abu said the deal potentially marks a “strategic alignment in the Middle East, whereby natural gas becomes a source of collaboration in the region”.
The aim was to try to complete the deal, which would require Israeli government approval, by the end of May, Delek said.
