Israel approves Tamar gas development plan

Israel’s government has approved Noble Energy’s development of the Tamar gas discovery in the deepwater sector of the Levantine basin in the Mediterranean Sea.

Offshore staff

HOUSTON – Israel’s government has approved Noble Energy’s development of the Tamar gas discovery in the deepwater sector of the Levantine basin in the Mediterranean Sea.

Until recently, Noble and its partners planned to develop the field using an option (Tamar North) that would flow gas to a new onshore receiving terminal in northern Israel. However, the selection and approval process for the site of the terminal has been delayed.

The Tamar North option would have delivered gas to Israeli customers in 2012. The shallow water Mari-B field offshore Ashkelon in southern Israel, which Noble also operates, is currently the country's only source of domestic production, but it is expected to decline sharply from late 2013 onwards.

Last week the Tamar partners recommended a new development option, Tamar South, to the Minister of National Infrastructure and the Petroleum Commissioner. This would be taken through the existing onshore reception terminal at Ashdod, and would provide for initial gas deliveries by late 2012.

Development would follow a similar track to the northern option, and the investment would be roughly same, but would involve bringing the gas south to a new offshore platform to be installed next to the Mari-B platform. From there, the gas would be diverted through the existing pipeline connecting Mari-B to Ashdod. The new platform would also take advantage of the structural design of the proven Mari-B platform. The Tamar South development option would provide for initial deliveries of Tamar gas by late 2012.

Charles D. Davidson, Noble Energy's chairman and CEO, said: "We continue to believe that Israel having a second gas receiving terminal in the northern half of the country provides significant benefits. However, it has also been made clear to us that the consequences to our customers, and ultimately the State of Israel, of delaying initial deliveries of Tamar gas by waiting for a northern terminal location are far too severe.

“Demand for natural gas is growing and today we are delivering record amounts of gas from Mari-B, which are being used primarily for electric power generation. The Mari-B partners are investing heavily in new wells and gas compression to maintain high gas deliverability for the next few years, but Mari-B gas reserves are finite and Tamar gas is needed soon.

“We will continue to work with the National Planning Council and the involved ministries in evaluating northern sites as we believe ultimately one will be needed. In the meantime we are pleased that the Tamar South option provides a fallback means for fulfilling Israel's near-term gas needs. The decision reached by the Minister of National Infrastructure on the proposed development plan paves the way for final sanctioning of this important project."

08/11/2010

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