Israel Will Export Some of its Natural Gas Discoveries

Ken Silverstein | Nov 01, 2013

When the Israeli Supreme Court handed down a high profile decision, it caught the world’s notice: The government there will be able to legally export 40 percent of the country’s natural gas, which is a newfound asset there that could benefit its internal economy as well as its foreign relations. 

Attention is now centered on Israel’s Tamar and Leviathan gas fields, which hold as much as 10 trillion cubic feet and 18 trillion cubic feet of natural gas, respectively. The latter is said to be the largest such find in the Mediterranean Sea. One of the key questions that Israel has been debating internally is whether the gas should stay at home or whether it could also be exported.

The developers, Noble Energy and its Israeli counterparts, Delek Drilling and Avner Exploration, have said that exporting the gas could bring many social and economic benefits to the Middle Eastern nation. For their part, it would give added opportunities but for the Israelis, it could also mean greater respect in both the region and European continent; their gas could compete with that of Russia’s Gazprom, which now supplies a quarter of Europe’s natural gas.

The left-leaning political parties as well as social activists there, however, have said that the nation needs to feed its own energy appetite before it would worry about offsetting supply issues tied to other countries. Moreover, the natural gas could help displace some of Israel’s coal-fired powered electricity, which has supplied 70 percent of the 11,300 megawatts it has. Natural gas provides 20 percent while oil makes up the rest.

Those groups thus petitioned the country’s high court to prevent such exports. They had argued that those kind of decisions are best made by the Knesset, or its national legislature -- not the government’s regulatory bodies. The High Court there voted recently 5-to-2 in favor of the government’s export decision.

According to Noble’s website, it has a 36 percent working interest at Tamar, which was discovered in 2009. At that time, it had been the largest deepwater natural gas discovery in the world. Now, though, “Leviathan represents the largest exploration success in Noble Energy’s history ... We are actively studying multiple export options, including both LNG and pipeline scenarios, as well as a potential domestic development solution.”

Within the Middle East and North Africa, Jordan and South Sudan have friendly relations with Israel and would likely be its customers. Meantime, Europe could look to Israel to provide such resources, or Europe could go turn to the United States. 



Here in this country, developers are also actively petitioning their government to export natural gas in the form of LNG. Some of the same economic arguments are being made, both for and against. Opponents fear, for example, that it would push up prices as international demand for the product increases. Proponents counter that more expansive markets mean increased economic growth at home.

That ‘export’ debate is now ongoing in both the United States and Israel. As for Israel, it is building a dozen new natural gas-fired generators, which helps explain why the nation will keep 60 percent of its natural gas discoveries at home. Beyond that, it has a longer-term goal of replacing many of its coal-and-oil-fired generators. Meantime, it is also trying to advance its wind and solar programs.

Israel’s natural gas discoveries are good for its internal economics as well as its global outreach efforts. Within its grasp are a cleaner energy future and better relations with other parts of the world.

 

Twitter: @Ken_Silverstein

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