Israel cabinet approves deal to develop Leviathan gas field

Leviathan

  • Israel’s cabinet has approved a regulatory framework that will pave the way for development of the Leviathan natural gas field.
  • The plan will allow Texas-based Noble Energy and Israel’s Delek Group to keep ownership of the massive offshore deposit, but will require them to sell off other assets, including stakes in another large field called Tamar.
  • Leviathan, with estimated reserves of 22T cf of gas, is slated to begin production in 2018 or 2019.

Prime Minister Benjamin Netanyahu said, “The decision that we make today will be nothing less than historic. This decision will earn the people of the country and the state treasury hundreds of millions of shekels. This money will go for education, health, welfare, and other national needs.

“I want to praise the work by the team headed by Minister of National Infrastructure, Energy, and Water Resources Yuval Steinitz, which substantially reduced the price that the state will pay for gas, as well as other changes that greatly improved the plan. I am not impressed by demagoguery – for me, it is only demagoguery, even though people can believe in what they say, but the country needs gas. Unfortunately, gas resources are going to be developed in our region regardless, and we have to make sure that our resources work at full steam. We need to get the gas out of the sea. The gas will leave the seabed and reach the people of Israel, Israeli industry, and the Israeli economy for the benefit of all Israelis.

Minister of National Infrastructure, Energy, and Water Resources Steinitz said, “After several years of regulatory deadlock and delay that have cost the state billions and damaged its energy security, I am convinced that the current plan is the best thing for Israel and its people. As far as prices are concerned, there will be a significant improvement, there will improvement in competition (today there is only the Tamar gas reservoir; there will be three reservoirs, and perhaps additional reservoirs); there will be improvement in energy security, and additional revenue for the state. The gas plan also has strategic economic value: an opportunity is being created for an economic connection on the peace axis.”

Source: Reuters