Deutsche Bank: Leviathan valuation 70 percent above our estimate
Dec 03, 2012 (Menafn - Globes - McClatchy-Tribune Information Services via COMTEX) --The value of the Leviathan gas reserve, as derived from the deal between the partners in the licenses and Woodside Petroleum (8.3 billion) is 70 percent higher than Deutsche Bank had estimated. In a note on Noble Energy released today following the deal with Woodside, Deutsche Bank's analysts write that it should contribute to the upside in Noble Energy's stock. Noble Energy will own 30 percent of Leviathan after the sale to Woodside, which will also own 30 percent.
Deutsche Bank recommends Noble Energy as a "Buy", and sets a target price of 117 for the stock, 20 percent above the current market price.
Barclays also points out that the deal valuation "is 71 percent higher than the current market valuation of Ratio Oil's share price, and 18 percent higher than our current valuation." After noting the farm-in agreement with Edison International announced by Ratio in the Gal permit, south of Leviathan, Barclays analyst David Kaplan asks "Why are Eastern Med assets attractive to super-majors?" and answers, "We believe Israel offers a more stable business and geopolitical environment than its neighbours, and companies that once were reluctant to invest may view the 30-40tcf in the Eastern Mediterranean as a possible addition to a larger asset portfolio."
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