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Page added on November 3, 2014
Israel must move quickly to develop Leviathan gas reservoir
“We are urging Israel to move quickly,” US envoy says at the Israel Energy and Business Convention in Tel Aviv.
Acknowledging the enormous economic and strategic prospects available to Israel’s expanding natural gas sector, US Ambassador to Israel Daniel Shapiro warned on Monday that the country must stabilize its investment environment in order to attract international developers.
“For all the opportunities in Israel’s energy sector a note of caution is warranted,” Shapiro said, noting that the US encourages American companies to invest in Israel.
“But companies have many places where they can invest their money,” he added.
Shapiro was addressing the Israel Energy and Business Convention in Tel Aviv on Monday morning, organized by the Eco Energy Finance and Strategic Consulting Firm. While Israel has a robust gas supply in its offshore Tamar and Leviathan reservoirs, there are many countries with greater energy resources, the ambassador cautioned. The development of “a stable, predictable investment environment is critical,” as the significant upfront investment required in the hydrocarbon industry must yield reliable returns, he said.
“We have consistently encouraged Israel to demonstrate that developing its energy resources is a government priority,” Shapiro added.
The timetable for bringing Israel’s larger Leviathan gas reservoir – which will predominantly be dedicated to export – is therefore critical, according to Shapiro.
“We are urging Israel to move quickly,” he said.
The 621-billion cubic meter Leviathan gas reservoir, located about 130 km. west of Haifa, is expected to begin flowing in approximately 2017, assuming bureaucratic and financial hurdles are surmounted. Noble Energy owns 39.66% of Leviathan, while Delek Drilling and Avner Oil – both subsidiaries of the Delek Group – each own 22.67% and Ratio Oil Exploration holds 15%.
The neighboring Tamar reservoir, a 282-b.cu.m. basin about 80 km. west of Haifa, began flowing to Israel’s domestic market in March 2013. At Tamar, Noble Energy holds 36% of the basin. Delek Drilling and Avner Oil Exploration each own 15.625%, while Isramco owns 28.75% and Dor Gas owns 4%.
Although several regional letters of intent have been signed between the Leviathan and Tamar developers and Israel’s neighbors, the companies continue to face many hurdles regarding the larger reservoir’s development, due to the great financial investment required. In May, Australian hydrocarbon firm Woodside Petroleum withdrew from a projected $2.71 billion deal to acquire 25 percent of the Leviathan basin – due to disagreements with the country’s Tax Authority.
Nonetheless, Shapiro stressed that the United States remains committed to helping Israel develop its natural gas sector, which holds great potential for success, and attract investors. Yet such development requires a stable climate for investment, he stressed.
“We want the US extensive experience and expertise in developing and managing our oil and gas industry to be part of the Israeli success story,” the ambassador said.
3 Comments on "Israel must move quickly to develop Leviathan gas reservoir"
bobinget on Mon, 3rd Nov 2014 11:20 am
BEIRUT, Nov 3 (Reuters) – Islamic State fighters in Syria said on Monday they had taken control of a gas field in the central province of Homs, the second gas field seized in a week after battles with government forces.
The hardline Sunni Islamist group posted 18 photos on social media showing the Islamic State flag raised in the Jahar gas field as well as seized vehicles and weaponry, according to the SITE jihadist website monitoring service.
Reuters could not independently confirm the events due to security restrictions.
Islamic State fighters, who now hold up to a third of Syria as well as swathes of Iraq and have declared a ‘Caliphate’ on the territories they control, took the larger Sha’ar gas field on Oct. 30.
“So after the (Sha’ar) company and the (positions) surrounding it became part of the land of the Caliphate, the soldiers advanced, conquering new areas, and all praise is due to Allah,” Islamic State said in the message.
“Yesterday they tightened control over Jahar village and the Mahr gas pumping company, and nearly nine (positions) supported by heavy weaponry such as tanks, armored vehicles, and heavy machine guns of various calibers,” it added.
The report said Islamic State had seized two tanks, seven four-wheel drive cars and several heavy machine guns.
A U.S.-led coalition has conducted air strikes against Islamic State since September. The United States says it is not coordinating with Syrian President Bashar al-Assad’s forces to combat the Islamist group. (Reporting by Oliver Holmes; Editing by Gareth Jones)
nemteck on Mon, 3rd Nov 2014 1:11 pm
“…. there are many countries with greater energy resources, the ambassador cautioned. Out of 193 countries, what constitutes “many”? 40, 50, or 100? I think Shapiro exaggerates to press Israel in signing up US companies quickly before others have a chance.
bobinget on Mon, 3rd Nov 2014 2:39 pm
Looks like KSA declared war on Russia today.
Saudi Arabia raised prices in Asia and Europe and lowered prices for the US. This caused an immediate
$2.00 crash for oil.
Since US oil companies are forbidden to export crude
the hope of recovery in US oil prices seem slim.
Canada OTOH, can export to Asia. I see Ottawa making sure that happens ASP. There is no way Alberta’s oil sands operations are to be permitted floundering.