Israel then and now

May 28, 2012
A 10-min interview with Israel's ministry of energy and water resources at the Offshore Technology Conference earlier this month reminded an OGJ editor of a chance meeting 4 decades earlier.

A 10-min interview with Israel's ministry of energy and water resources at the Offshore Technology Conference earlier this month reminded an OGJ editor of a chance meeting 4 decades earlier.

The editor, then employed at a Tulsa newspaper, was assigned to attend the annual meeting of the Oklahoma Independent Petroleum Association at the Shangri La Resort lodge on Grand Lake O' the Cherokees in northeastern Oklahoma.

Upon entering the evening reception, the editor met a group of Oklahoma-based independent oil operators who were renewing acquaintance.

"Alan," one said, "you are in the presence of the only three independent oil producers ever to drill exploratory wells in Israel, and all of us came away with dry holes."

How the picture has changed.

Israel's gas endowment

Exploratory drilling the past few years has led to the discovery of an estimated 35 tcf of gas in place in Levant basin waters offshore Israel and Cyprus.

The US Geological Survey has estimated that the 83,000 sq km basin, which lies mostly in Israeli waters, could contain undiscovered technically recoverable mean conventional volumes of 122 tcf of natural gas, 1.7 billion bbl of oil, and 3 billion bbl of natural gas liquids.

The discoveries bode well for the future of natural gas production, power generation, water desalination and distribution, and other cooperation for the entire region, said the Israeli minister Uzi Landau.

The Noble Energy Inc. group still believes that oil could be discovered in the petroleum system below the gas it has found, Landau noted (OGJ Online, May 3, 2012). One investment research firm concluded that Noble Energy has "identified sizable oil prospects at two layers beneath Leviathan, one with 17% probability of success and 3 billion bbl of oil equivalent and the other with 8% probability and 1.2 billion boe."

Besides using its newfound gas to generate power, purify water, and treat sewage, Israel will surely authorize natural gas exports, perhaps as early as this fall, as recommended in a draft report prepared for the government, Landau said.

After domestic use, as much as 300 billion cu m should remain for export based on the Leviathan and Tamar deepwater subsalt discoveries alone, he said. This could be shipped as LNG or by pipeline to buyers that would include Syria and Jordan if they should choose to buy it.

"Imports could serve to develop faith between us," he said. "Israel should not remain an energy island as it is today."

The Levant basin is lightly explored, and several other groups of companies are lined up awaiting rigs and other approvals to drill more wells.

Wide trade potential

Landau said the discovery of large volumes of gas may enable Israel to export gas to Europe and the Far East in addition to distributing it locally.

The availability of a gas supply of such magnitude is conducive to creating an "axis of stability in the Eastern Mediterranean," he said.

Israel is already in talks with the Cyprus government on how to promote energy ties. Israel and Cyprus are negotiating a unitization agreement to cover the cross-border Aphrodite structure.

Israel is examining the feasibility of laying a subsea cable capable of transmitting on the order of 2,000 Mw of electricity to provide back-up power for both countries in case of outages, Landau noted.

Israel and Greece have signed an agreement for a subsea power cable from Israel to Greece via Crete, he said.

Israel wants to make clear that it does not view its gas discovery fortunes as having created a shangri la for Israel in isolation.

The Middle East, Landau said, suffers increasing instability in the entire surrounding Arab world, and Israel's challenge is not to make a mistake, he said, not to "act as he who has become rich."

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About the Author

Alan Petzet | Chief Editor Exploration

Alan Petzet is Chief Editor-Exploration of Oil & Gas Journal in Houston. He is editor of the Weekly E&D Newsletter, emailed to OGJ subscribers, and a regular contributor to the OGJ Online subscriber website.

Petzet joined OGJ in 1981 after 13 years in the Tulsa World business-oil department. He was named OGJ Exploration Editor in 1990. A native of Tulsa, he has a BA in journalism from the University of Tulsa.