Israel Courting Energy Heavyweights to Seek Offshore Gas - Bloomberg
▻http://www.bloomberg.com/news/articles/2016-08-31/israel-courting-energy-heavyweights-to-seek-offshore-gas
Israel’s Energy Minister Yuval Steinitz is out to persuade big energy explorers put off by years of regulatory turmoil to search for natural gas off his country’s shores.
At a road show in London this week, Steinitz will sit down with executives from large and mid-sized energy companies to make his case that prospects for finding big reserves are good.
“According to geological and seismological surveys, it is very probable that most of the natural gas is yet to be found,” Steinitz said in an interview late Tuesday, on the eve of his London trip. “We hope to see at least two or three large companies submitting bids.”
A report by French consultants Beicip-Franlab SA estimated that Israel’s waters hold 2,200 billion cubic meters of undiscovered gas, about 2 1/2 times the amount contained in known fields, Steinitz said. In the past 12 months, he said, he’s met with chairmen, executives and directors of almost all of the world’s major gas companies to promote new exploration.
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Foreign companies shied from Israel during the years of regulatory turmoil, which ended with higher taxes and forced divestitures for investors in Leviathan and Tamar, the country’s second-biggest field. Amos Hochstein, the U.S. State Department’s special envoy for global energy affairs, said in an interview this month that big explorers will need to be reassured that the Israeli government won’t start changing regulation and tax laws.
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Solid diplomatic relations with potential energy partners in the region are also central to bringing large companies to Israel, he said. Israel has held gas talks with Egypt, Jordan and the Palestinian Authority, and is considering building a pipeline to Turkey and using idle LNG facilities in Egypt.
“We need to see the clearing of the geopolitical path, with obstacles removed for export deals in the region and that is already happening,” Hochstein said. He singled out the recent Israel-Turkey reconciliation deal as a major step forward and expressed optimism about talks for a reunification of Cyprus, which a pipeline to Turkey would traverse.