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The report was prepared by Netherland, Sewell & Associates (or NSAI), an independent reserve appraiser. The report includes estimates of the amount of contingent reserves and contingent resources attributed to Ithaca’s oil assets.
The report shows an increase of 39 million barrels. The total discounted cash flow for these reserves, at a discount rate of 10%, is approximately $ 3.846 billion. At the end of June 2020, the discounted cash flow was $ 3.05 billion. This is an increase of more than $ 800 million.
Idan Wells, CEO of Delek Group Photo: Amit Shaal
The value of capitalized cash flow for Type 2P reserves increased by $ 500 million to $ 2.9 billion, while the value of capitalized cash flow for Type 2C contingent resources increased by $ 293 million to $ 946 million.
The increase in cash flow is a result of an increase in the amount of 2P oil and natural gas reserves and in the amount of resources contingent on the best estimate (2C) of all Ithaca oil assets, at the end of 2020, to a total of approximately 297 million equivalent oil barrels (BOE) compared to a total of approx. -258 million BOE as of June 30, 2020. The price of oil rose during the fourth quarter from $ 41 to $ 52 a barrel and currently stands at $ 64.
Idan Wells, CEO of the Delek Group, stated: “The quality of Ithaca’s assets and their significant potential for the Delek Group are reflected in the excellent data in the resource report. In the past year, Ithaca has performed well, which was reflected, among other things, in significant dividends of about $ 120 million during the year, at a time when almost no energy company distributed a dividend to its shareholders. Ithaca is an important anchor for the group, and an engine of growth for its continued activity and flooding of value. “
Delek Group is traded at a value of NIS 3.2 billion after a year ago, at the height of the corona crisis and the sharp decline in demand for oil, its value fell to less than NIS 799 million.