Israeli Energy Minister Expects Majors To Enter Country's Energy Industry
Yuval Steinitz, the Israeli Energy Minister already sees the light at the end of the tunnel when it comes to the approval of the long-awaited natural gas regulatory framework in Israel. In his opening remarks to Israel's 2nd Annual Oil & Gas Conference, which was opened yesterday (Tuesday) in Tel Aviv, Mr. Steinitz painted a rosy future for the Israeli natural gas industry the day after the framework is approved.
"I believe that in the middle of December this [the framework's approval process] will be over and 2016 will start with the natural gas framework fully in place, which means that immediately at the beginning or 2016 the sale of Karish-Tanin [gas fields] will go ahead," Mr. Steinitz said. "The maximum length of time for the sale is 14 months, but it will happen much faster. Sale of some part of Tamar might take a bit longer."
Mr. Steinitz said that he expects a speedy development of the Leviathan gas field since there is a commitment to do so, and it should be completed within four years, though he added "it is quite fast for such a big reservoir." As part of the framework, the expansion of the Tamar field will take place and the two small reservoirs of Karish and Tanin will be developed by a new operator.
Following those developments, Israel will launch a new round of tenders for exploration licenses in its territorial waters, in which new players, including energy majors, are expected to take part.
In reference to the geopolitical situation in the region, Mr. Steinitz said that Israel has established a very good and tight cooperation with its neighbours Egypt, Cyprus, and Jordan. In the future, he expects Israel to expand its cooperation with Greece and Turkey. Cooperation between Cyprus, Egypt, and Israel is already very strong, he emphasized.
Mr. Steinitz also said that it is clear there are good prospects for future huge hydrocarbon discoveries either in Israel or other neighbouring countries' exclusive economic zones (EEZs) in the Levant Basin.
Mr. Steinitz envisaged three options for natural gas export from Israel and the Eastern Mediterranean to Europe: either through the LNG facilities in Egypt, or in the case that another gas field as huge as Leviathan field is found, through the possibility of construction of a pipeline. That envisaged pipeline would transit gas from Israel to Cyprus and Greece and from there to other parts of Europe. "This is a very big and expensive project," Mr. Steinitz said.
In the conclusion of his remarks, Mr. Steinitz said that he expects major energy companies to enter the Israeli market, and since Israel is going to be an important player in the mid-east natural gas scene that it is imperative for energy companies to invest in Israel.