Israel’s Energy Future


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Energy has always been the weak link in Israel’s thriving economy. Decades of digging and drilling yielded practically no hydrocarbons at all. Israel was forced to spend 5% of its GDP buying fuel from suppliers that did not have its interests at heart, and were often unreliable. At one point for instance, Israel purchased 40% of its natural gas from Egypt. But the pipeline across the Sinai has been bombed so many times there was often not enough time between explosions to get the gas flowing again. Post-Mubarak Egypt desperately needs the money to replace lost tourism revenue, but hatred of Israel trumps all.

The first brightening of this bleak picture came in 1998, when offshore drilling in Israel’s Mediterranean waters got under way. In 2000, a consortium led by Noble Energy of Houston struck commercial quantities of natural gas off the southern coast, west of Ashdod. By 2004, the Mari B field was in full production, with reserves of nearly 1 trillion cubic feet of gas. This remains the only currently producing offshore well in Israel.

But Noble Energy was convinced there must be bigger reserves waiting in deeper waters, and in 2009, diligent exploration paid off in a big way. The Tamar field, with 9 trillion cubic feet of gas, was the biggest offshore gas field found anywhere in the world that year. And the next year, Noble Energy struck it even richer with the 16 trillion cubic foot Leviathan field, further west of Haifa. That was the biggest offshore find of the decade. Together, these discoveries opened up entirely new possibilities. The Tamar field, with enough gas to supply all of Israel’s needs for decades, offered energy security, and the Leviathan field offered energy for export and billions of dollars a year in potential revenues.

Gas is scheduled to start flowing from Tamar in 2013 and from Leviathan in 2016. With the same consortium operating Mari B and Tamar and Leviathan, the Israeli government was very concerned about giving one group of companies a monopoly over its offshore gas. This monopoly has now been broken by other companies who’ve found rich pickings in the sea off central Israel. A three-dimensional seismographic survey of the Myra and Sarah fields northwest of Netanya and southeast of Leviathan has revealed 6.5 trillion cubic feet of gas waiting to be developed by a consortium led by the Israel Land Development Company.

Modiin Energy has a controlling interest in the Gabriella field in shallow water not far west of Tel Aviv, with an estimated 3.56 trillion cubic feet of gas, and the Yam Hadera field west of Hadera, with an estimated 1.4 trillion cubic feet.

Adira Energy, a Canadian company, is developing the Yitzhak field southwest of Netanya, with an estimated 989 billion cubic feet. And ATP Oil & Gas of Houston has partnered with Isramco Negev to develop the Shimshon field, with a best estimate of 2.3 trillion cubic feet.

Of course, Nobel Energy hasn’t rested on its laurels after Leviathan. It has identified 12 more prospects with 20 trillion cubic feet of potential gas in the territory covered by its licenses. And all of the fields mentioned have substantial quantities of oil waiting to be developed as well. The best estimate for the Gabriella field alone is 277 million barrels of oil.

Getting the most out of all these discoveries will take not just technical expertise and money, but strategic thinking and sound diplomacy as well. And that is what Israel has been practicing, with Greece and Cyprus in particular.

Israel has carefully cultivated its relations with Greece since early in 2010. Progress began with an unlikely but warm personal relationship between Prime Ministers Netanyahu and Papandreou. It intensified after Turkish-Israeli relations fell into a deep-freeze following the Mavi Marmara incident, and after the scope of the Leviathan discovery became clear. Face-to-face meetings between officials in Athens and Jerusalem, business and tourism delegations, sharing of intelligence, and joint exercises between the Israeli and Greek air forces all bore fruit when the Greek Coast Guard brought the 2011 version of the Gaza flotilla to a complete halt, and Israel tirelessly lobbied the EU to extend a helping hand to Greece in the face of its financial crisis.

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  • UCSPanther

    Israel: Small but mighty, and will become mightier, especially with Greece and Canada on her side.

    Something for the assorted dictators, theocrats and oil sheiks of the ME to think about as their power erodes and chaos takes over.

    Turkey has shot itself in its collective foot after its decision to make Israel into enemies over a botched propaganda flotilla and its decision to rekindle old emnities against the Greeks…

    • ziontruth

      "Turkey has shot itself in its collective foot…"

      More like, in its collective head. And this, not by such particulars as the terrorism flotilla, but by the general decision to backslide into its Islamic past.

      If so for Turkey—the same Turkey as was dragged into modernity by Ataturk—then what hope for any other Muslim-majority state? None at all. That's why there can be nothing to the recent revolutions but an Arab springboard to Islamic theocracy, to turning state after state into a base for the worldwide jihad.

      • effemall

        I'm afraid your projections are realistic and our grandchildren will have to fight the Crusades all over again.

        • ObamaYoMoma

          I know this isn't a very pleasant subject, but nevertheless eventually the Middle East oilfields will have to be seized and occupied and the considerable unearned oil wealth of the Saudis and the Gulf State Emirs will have to be confiscated and taken away from them. Otherwise, they will simply continue using those resources permanently to wage jihad against the West per the dictates of Islam forever.

          It's not like we would be stealing those resources away from them out of greed. Instead, it would be an act self-defense and self-preservation. It's either we take those resources away from them, or otherwise they will use those resources to wage jihad against the West perpetually to make Islam supreme. We really don't have any other choice in the matter. It's either do or die.

  • Raymond in DC

    Those gas finds are only part of Israel's new energy reality. Massive quantities of oil shale have also been discovered on shore (virtually all within the 1949 borders), but extraction will involve new technology that will need to be proven. But if the pilot plant shows extraction can be done economically and with minimal environmental damage, this will change everything.

    • FriendofGaryCooper

      From what I understand, Israel HAS perfected a way to extract the oil from these
      oil shale deposits; that are located somewhere underneath the Bab_el Wad, between Jerusalem and Tel Aviv. The extraction method doesn't use any water, and doesn''t harm the environment.

      • johnnywoods

        That is my understanding also as per Zion Oil and Gas.

  • Bert

    Israel is rightly making the most of this situation with offshore oil and gas. However, oil, gas, coal and nuclear are all obsolete energy sources and are ultimately transitional. Please go to http://www.byronwine.com and see cars running on ordinary tap water. Advanced energy technologies have been known for years but have been blocked by the global energy interests which could be put out of business.
    Water as fuel is only one among a number of breakthrough energy sources that use NO fuel. If, for example, the design of water-fuel technology were made public the world would be truly turned upside down. Those nations that rely on oil for major income would be devastated including Israel's enemies and Russia.
    The problem has been the total silence of the leadership class and the media and their refusal to investigate these technologies. I contacted the offices of 50 congressmen and senators of BOTH parties, the media, environmental organizations, etc. about these energy technologies. Incredibly NOT ONE of them showed any interest at all to even investigate. It does seem that the fix is in, not just in America but globally as well.
    Readers are invited to test this claim of a blackout for themselves. They will either get no response at all or, at most, a dismissal without any serious investigation.

    • johnnywoods

      The problem for Israel using water instead of hydro-carbons is that water is more scarce than petroleum unless you can use sea water but then the Palestinians will claim that Israel is stealing their water:)