Delek : Upgrade and Improvement Work on the Tamar Platform and the Terminal

Tel Aviv, September 24, 2017. Delek Group (TASE: DLEKG, US ADR: DGRLY) ('the Company') announces that below is an immediate report published by Delek Drilling - Limited Partnership regarding upgrade and improvement work on the Tamar platform.

Further to the provisions of Section 3 of the Update to Chapter A (Description of the Partnership's Business), included in the periodic report of the Partnership as of June 30, 2017, as released on August 15, 2017 (ref. no.: 2017-01-083313) regarding upgrade and improvement work on the Tamar platform and the terminal which the Tamar project operator, Noble Energy Mediterranean Ltd., (the 'Operator') is scheduled to perform in the months of September-October 2017, the Partnership respectfully updates that on September 20, 2017 the Operator commenced performance of the upgrade work as planned, during which a crack was discovered in the emission pipe used to release natural gas and pressure from the platform routinely and in emergencies (the 'Crack' or the 'Malfunction'). Following identification of the Crack, and according to the procedures in place at the Tamar Platform, the supply of natural gas from the Tamar reservoir was stopped in a controlled manner on September 21, 2017 .

The Operator has informed the Tamar partners that there is no safety and environmental exposure .

The Operator is acting to repair the Malfunction, and has updated the Tamar Partners that the planned date for completion of the repair and commencement of flow of natural gas from the Tamar reservoir is during the coming week. It is noted that the cost of the repair is not expected to be material .
Following a comprehensive engineering analysis, the Operator decided to continue the planned upgrade work, concurrently with repairing the Malfunction. The said upgrade works are expected to be completed on schedule, as planned .

The Tamar partners are acting to inform their customers as required, in accordance with the terms and conditions of the gas supply agreements signed with them, and are maintaining continuous contact and acting in full coordination with the various Government offices .

In the Company's estimation, the decline in the supply of natural gas form the date of cessation of the flow of natural gas until the expected date of repair of the Malfunction (during which time the gas flow from the Tamar field to the Tamar production platform was in any event planned to be performed through only one of two pipes, and at one half the maximum production capacity, due to the upgrade work), is expected to amount to about 0.1 BCM (100%), reflecting a decrease of approx. U.S. $3.5 million (net, after payment of royalties and taxes) in the Partnership's revenues from the sale of natural gas. Accordingly, the Malfunction is not expected to have a material effect on the Partnership's revenues from the sale of natural gas in the third and fourth quarters of 2017 .

Warning regarding forward-looking information - The Partnership's estimates regarding the time tables for repair of the Malfunction, the cost of the repair and the effect of the Malfunction on the Partnership's revenues from the sale of natural gas in the third and fourth quarters of 2017, constitute forward-looking information, as defined in the Securities Law, 5728-1968, which are based, inter alia, on estimations received by the Partnership from the Operator and on the Partnership's estimations regarding the expected natural gas sales figures for the third and fourth quarters of 2017. The actual performance of the repair, including the time tables and cost of the repair, and the Partnership's estimation regarding the projected effect of the Malfunction on the Partnership's revenues from the sale of natural gas, may be materially different to the above estimations, inter alia, as a result of operating and technical conditions and/or the actual performance of the project and/or actual natural gas sales figures .

The partners in the Tamar project and their holding rates are as follows :
Noble Energy Mediterranean Ltd. 32.50%
Isramco Negev 2, Limited Partnership 28.75%
Delek Drilling - Limited Partnership 22.00%
Tamar Petroleum Ltd. 9.25%
Dor Gas Exploration - Limited Partnership 4.00%
Everest Infrastructures - Limited Partnership 3.5%

Delek Group economic interest 14.44%

This is a convenience translation of the original HEBREW immediate report issued to the Tel Aviv Stock Exchange by the Company on September 24, 2017.

About The Delek Group

Delek Group is an independent E&P and the pioneering visionary behind the development of the East Med. With eight consecutive finds in the Levant Basin, Delek is leading the region's development into a major natural gas export hub. In addition, Delek has embarked on an international expansion with a focus on high-potential opportunities in the North Sea and North America. Delek Group is one of Israel's largest and most prominent companies with a consistent track record of growth. Its shares are traded on the Tel Aviv Stock Exchange (TASE:DLEKG) and are part of the TA 35 Index.

For more information on Delek Group please visit www.delek-group.com

Contact

Investors

Dina Vince
Head of Investor Relations
Delek Group Ltd.
Tel: +972 9 863 8444
investor@delek-group.com