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Israel's Delek Group Q1 profit up on higher natgas sales

TEL AVIV, May 29 (Reuters) - Israeli energy conglomerate Delek Group reported sharply higher quarterly net profit, boosted by increased sales of natural gas from the Tamar reservoir and higher profit at its insurance subsidiary.

Delek said on Monday it earned 220 million shekels ($61.5 million) in the first quarter, up from 85 million a year earlier. Revenue rose to 1.5 billion shekels from 1.3 billion.

Delek also had a large profit from Phoenix, the insurance unit it is seeking to sell to China’s Yango Group , due to higher income and a rise in the share price.

Delek, through its subsidiaries, has major shares in the Tamar and Leviathan gas fields off Israel’s coast. Profit from exploration and production was 127 million shekels in the quarter, compared with 110 million in the same period in 2016.

It said it produced 2.4 billion cubic metres of natural gas at Tamar in the quarter, up 9 percent from a year earlier.

It expects production at Leviathan to begin by the end of 2019. The project’s partners have budgeted $3.75 billion for its development.

Delek expects to complete its purchase of the remaining shares in North Sea oil producer Ithaca Energy Inc by the end of June, at which point the shares will be delisted from the Toronto exchange and London’s AIM.

“Having acquired control of Ithaca, we intend to continue to strengthen the group’s international presence as part of our strategy to focus on the energy sector and become a key player in global markets,” Chief Executive Asaf Bartfeld said.

Delek declared a dividend of 200 million shekels, or 16.69 shekels a share, unchanged from the fourth quarter. ($1 = 3.5758 shekels) (Reporting by Tova Cohen)