Gas Flow From Tamar to Restart Sept 27

The Tamar gas platform off Israel will restart production September 27, according to the operator Tamar Partnership. The flow stopped September 21 when a leak was discovered at the offshore processing plant. But the system was on maintenance when the leak was discovered and it will continue to run at half capacity until the end of October. 

Partner Noble Energy notified its customers of a force majeure preventing it from carrying out its contractual duties but their lawyers said they would challenge that.

As a result of the incident, a state of emergency in the energy sector was declared and the energy ministry set gas quotas for the various organisations, with Israel Electric Corp receiving most of the gas from the LNG importing vessel and the rest of the gas being pumped to refineries. Factories connected to the natural gas grid had to switch to other, more expensive, fuels.

At present, Israel imports LNG through an offshore terminal about 10 km from the shore opposite a power station halfway between Haifa and Tel Aviv. A new LNG cargo is due in the next few weeks. If this cargo does not arrive on time, power outages may occur. Meanwhile, hundreds of fuel tankers have been mobilised in order to transport fuel oil from the refineries to power stations. In order to reduce fuel costs, the ministry asked the finance ministry to waive heavy taxes on fuel for power generation.

Diesel and coal have once again become the main fuels for electricity generation, while LNG contributed less than 10%. The result was a sharp rise in the cost of electricity generation, but this has not yet led to higher power prices.

Ya'avov Zalel