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Offshore Drilling

Tamar drilling site (archives) Photo: Albatross
Tamar drilling site (archives) Photo: Albatross
 
Minister Landau (archives) Photo: Tal Shahar
Minister Landau (archives) Photo: Tal Shahar
 
 

Leviathan gas well estimated at $45B

Reservoir located off of Haifa coast said to contain 453 billion cubic meters of natural gas, making it decade's largest gas discovery

Tani Goldstein
Published: 12.29.10, 18:04 / Israel Business

The Leviathan exploration prospect, which is located northwest of the coast of Haifa, contains 80% more natural gas than the Tamar reservoir, which was previously considered Israel's largest drilling site, a report released Wednesday by Delek Energy revealed.

 

According to the report, the quantity of natural gas found in the well is estimated to be 453 billion cubic meters. Energy analysts appraised the natural gas to be worth $45 billion ($100 million per billion cubic meters).

 

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"Today we received the most important piece of Energy news since the foundation of the State," National Infrastructure Minister Uzi Landau said. "Israel can enjoy not only the use of the gas, but can actually also turn into a gas supplier in the Middle East."

 

'Happy news for Israel'

The quantity of natural gas found in Leviathan is the largest discovery of its kind in a decade. The drilling site is located 1,634 meters (5,361 feet) deep in the water, 135 kilometers (84 miles) off the short of Haifa, and 47 kilometers (29 miles) southwest of the Tamar exploration prospect.


Leviathan site (Photo: Albatros)

 

"These results are happy news for the Israeli energy market," said Delek Group CEO Gideon Tadmor. "They have an immense financial and strategic significance."

 

The companies that hold the drilling license for the site, Delek Energy and Noble Energy, estimate that the Leviathan prospect spreads across 325 cubic kilometers, making it necessary to conduct at least two appraisal drillings in order to continue exploring the gas resources. The drilling projects will reach a total depth of 7,200 meters (23,622 feet).

 

The Delek Group, which is owned by Yitzhak Tshuva, holds 45.34% of the Leviathan shares through its daughter companies Delek Drillings and Avner Oil and Gas. Noble Energy holds 39.66% of the shares, and Ratzio Oil Search holds 15%.

 

The announcement comes in the height of the public debate over the conclusion of the Finance Ministry's advisory committee, headed by Hebrew University economist Eytan Sheshinski, that the royalties paid to Israel by companies drilling off its shores should be raised to 66%. Drilling companies and shareholders oppose the conclusion, saying that it just does not pay to drill for gas under these conditions.

  

 

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