Page 9 - MEOG Week 35 2021

MEOG POLICY MEOG

Israel calls time on issuing

onshore exploration permits

ISRAEL RECENTLY appointed Israeli energy minister country’s offshore Leviathan gas field are pre-
Karine Elharrar said this week that the country paring to drill the Leviathan-8 development and
would no longer issue permits for onshore oil production well in the area of lease I/15 in Levi-
exploration. athan North during 2022, rather than in “later
Speaking at a conference, she said: “Starting years” as had previously been planned.
today, no more licences will be issued for oil The well, which will be located around 130km
exploration on land in the State of Israel.” west of Haifa, will take around four months to
Elharrar added: “Oil is a highly polluting drill and will cost around $248mn which will be
fuel that has no place in a country that is doing split between Delek Drilling (45.34%), Chevron
everything to reduce the use of coal and under- (39.66%, operator) and Ratio Oil Exploration
stands that gas is also only an intermediate solu- (15%) according to their shareholding.
tion until we can rely on renewable energies.” It will take place at a sea depth of 1,620 metres
Meanwhile, in one of her most pointed jabs at and reach a total depth of 5,300 metres. The
predecessor Yuval Steinitz she said: “Contrary to drilling will be carried out by the Stena Forth
the previous regime, under which connections drillship.
were the determining factor, appointments to Delek said that Chevron had recommended
government companies for which I am respon- drilling the well owing to “the redundancy in the
sible will be based on the appointee’s experience production system” and considering current vol-
and the needs of the particular company.” umes of production and demand.
Elharrar stressed that under her steward- It added that the well would be “integrated
ship, Israel would focus on developing renewa- as part of the production drilling system” with
ble energy, in contrast to the Steinitz era which the required infrastructure constructed for its
was defined by the development of offshore gas connection to the existing subsea production
reserves. system.
In further criticism of the previous regime, In March, Delek said that the partners
she said: “After three years without a state budget expected 2021 gas sales from the asset to be 10bn
and without reforms, it’s important that we make cubic metres, marking a 1.1bcm increase on the
progress. The [former] government didn’t really 8.9bcm estimate provided in July 2020 when the
give a high profile to climate change and the need partners factored the impact of the Covid-19
to battle against it. We have to act fast and with pandemic into their forecast. However, it still
determination.” falls below the previously anticipated level of
Speaking to the Times of Israel, she noted that 10.8bcm.
the ban on issuing permits related only to crude The increased sales are expected to see total
oil and not to oil shale. There are currently five revenue from the field reach $1.7bn in 2021, with
active licences for onshore oil production and Delek taking an equity share of $760mn. These
three for exploration. figures are based on a conservative Brent crude
Meanwhile, the partners developing the price of around $52 in 2021.™

Week 35 01•September•2021 www. NEWSBASE .com P9