* Noble Energy warns of risk of delay to Leviathandevelopment
* Netanyahu hopes to use gas exports to improve regionalties
* Analyst: Government could offer financial guarantees tocompanies
By Tova Cohen
TEL AVIV, March 28 (Reuters) - An Israeli supreme courtruling barring the government from giving a 10-year guarantee toan American energy firm and its Israeli partner could delayIsrael's emergence as a major regional natural gas exporter, thecompanies said on Monday.
Israel is hoping that the huge Leviathan natural gas fieldoff its shores in the Mediterranean will come on line by 2019,allowing it to sell energy to Egypt, Jordan, Turkey or beyondand transforming its relations with Middle East neighbours.
But the Supreme Court caused a hiccup late on Sunday with aruling that invalidated a guarantee clause in a deal reachedlast year between Prime Minister Benjamin Netanyahu and theconsortium of Texas-based Noble Energy and Israelipartner Delek Group.
The judges said the government is not in the position tomake such a long-term concession and gave the sides a year tocome up with an alternative arrangement for the government toprovide stability assurances.
Noble called the court's decision "disappointing" and saidit risked causing a delay in the $5 billion-$6 billion projectto develop the 22 trillion-cubic-foot gas field.
"Development of a project of this magnitude, where largeinvestments are to be made over multiple years, requires Israelto provide a stable investment climate," Noble CEO David Stoversaid in a statement. "We will vigorously defend our rightsrelated to our assets to protect shareholder value."
"It is now up to the government of Israel to deliver asolution which at least meets the terms of the framework, and todo so quickly," he said.
Yossi Abu, chief executive of Delek's subsidiaries DelekDrilling and Avner Oil, said the companieswould work with the government to find an alternative to thestability clause, and push ahead with development plans in thehope of avoiding delays.
"We are focusing on finding a solution in order to maintainthe timetable that we put forward," Abu told Reuters, addingthat he hoped the decision would not hurt export opportunities.
The companies hope to finalise long-term export deals with aRoyal Dutch Shell plant in Egypt, Jordan's national electricitycompany and the Palestinian Authority. Exports to Turkey remainan option as well.
Noble and Delek are already producing gas for domesticconsumption from Tamar, a smaller field nearby.
MONOPOLY
With nearly all of Israel's proven gas deposits in the handsof Noble and Delek, opposition lawmakers and public advocacygroups have taken to the streets to protest against what theyconsider a gas monopoly that will hurt consumers.
Netanyahu argues that the proposed outline, which leavesNoble and Delek in control of Leviathan while forcing them tosell smaller, yet sizeable, assets, will bring new competition.
Italy's Edison has expressed interest in thesesmaller reserves but has held back due to regulatoryuncertainty.
"The government is exploring its options to figure out howto move forward," said a government official in the energysector who asked not to be identified. "There is no specificdirection at the moment."
One path for Netanyahu could be to pass legislation inparliament that would support the 10-year commitment. But giventhe strong opposition and his single-seat majority, such a moveseems unlikely. Energy analysts suggested the parties wouldreturn to the negotiating table.
Eldad Tamir, CEO of the Tamir Fishman investment house,believes the government will move quickly to provide financialguarantees to compensate for any damage the companies mightincur from changes to the gas agreement.
"I believe the court in effect gave the government a stronghint how it can put an end to this saga," he said.
Shares in Israel's gas companies were down 4-5 percent inafternoon trade, recovering somewhat from earlier lows, withminority partner Ratio falling 7.9 percent.
Barclays analyst Tavy Rosner said Delek's commitment todevelop Leviathan on time might be overly optimistic. Thecompanies are unlikely to secure export contracts without astability clause and working around that clause could takeseveral months.
Nevertheless, he said, "we view the long-term story as beingintact and believe that the Leviathan field is too important forIsrael not to be developed." (Additional reporting by Ari Rabinovitch and Steven Scheer;editing by Peter Graff)
