Isramco, Dor Gas: Let us export more gas

Companies holding third of Tamar natural gas field petition High Court against government decision putting 40% cap on gas export

Lior Gutman, Calcalist|Published: 11.10.13 , 07:54

Two energy companies, Isramco and Dor Gas, filed a petition Thursday with the High Court of Justice to force the government to increase the quota for exportable natural gas from 40% to 50%.

The petition was filed against the Prime Minister's Office, the Ministry of Energy Resources, and a number of energy companies operating in Israel like Noble Energy, Delek Energy, Delek Drilling, and Modiin Energy.

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The petitioners claim the government decision from June does not correctly address the letter of the law and creates discrimination between companies. Isramco and Dor Gas own 32.75% of the gas reserves in the Tamar field, and planned on working together with other energy partners – Noble Energy, Delek Drilling, and Avner Oil Exploration – to export the natural gas to the Far East.

The Tamar export project was signed in a memorandum of understanding in February with Russian gas giant Gazprom and Daewoo International, the largest Korean trading company. The essence of the massive undertaking was to assure that the Tamar field could export 85 BCM (billion cubic meters) of natural gas to foreign customers by using a large floating facility.

The export project had a 20 year span during which Daewoo built the facility while Gazprom was tasked with finding suitable foreign customers.

Tamar installation transferring natural gas (Photo: Albatross)

The government's decision to limit the total export allowed to 40% of the reserves leaves the energy companies with only 50 BCM for export, practically putting an end to the entire project.

"The owners of the Tamar field are obligated, subject to different conditions, to sell 170 BCM of the reserves to the Israeli market," the petition claimed and stated that "this means that the government decision permits the Tamar field to export only up to 20% of the reserves."

"The percentage of gas that the Tamar field is allowed to export is less than half the percentage of gas that was permitted the Leviathan field to export (though Leviathan's reserves are much more substantial), and it is small in proportion to the percentages allowed other fields to export compared to their proven reserves," continued the petition, which leads the petitioners to conclude that the government's decision must be changed.