Tel Aviv — The five new Israeli offshore blocks awarded last year to Energean have a potential reserve of 126 Bcm, according to an initial analysis conducted by Netherland, Sewell & Associates (NSAI), the Greek exploration company said. The estimates added a significant amount to Israel's resource base potential and could contribute to a change in the current 40% export limit and higher exports to Egypt or Turkey.
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The Karish and Tanin offshore fields, which Energean is developing has proven natural gas reserves of 86 Bcm. In February, producers Delek and Noble signed a 10-year deal with Egypt's Dolphinius Holdings for the LNG re-export of 64 Bcm of gas from Tamar and Leviathan offshore fields from early 2019.
"We have a contingent commitment to conduct exploratory drilling in the new blocks," Energean CEO Mathios Rigas said. The five blocks are 12, 21, 22, 23 and 31.
The company said exploratory drilling could take place after the first production drilling at Karish scheduled for March 2019. The blocks are near the Karish and Tanin reservoirs, with production expected to start in 2020. The two reservoirs are being developed for Israel's domestic market.
However, Israel's energy and water resources ministry has said future discoveries would be for export.
In June, the government decided to leave unchanged the percentage of potential gas exports from offshore fields at 40% of total reserves.
The government review committee did, however, open the door for more exports based on future finds and did make some minor changes. Israeli energy industry sources said additional discoveries could increase that level in the years to come.
Coinciding with the Energean announcement was a report on the YNet news website regarding a classified report by the Israel foreign ministry's research center which recommended any future gas exports to Europe be directed via Egypt and not Turkey. YNet said the foreign ministry report deemed Turkey a "dangerous and volatile" player in the Middle East.
The report weighed the economic, political, strategic and energy advantages of the two routes under consideration, through Turkey and through Egypt, for future Israeli gas exports to Europe. It cited a third and more expensive route, via Greece, but said that though there was political support for the proposal, it lacked economic backing and was far more long term in nature.
In June, Delek Drilling and Noble Energy said they were planning a $200 million investment to acquire the idle 10 Bcm/year East Med Gas (EMG) pipeline to reverse its flow to facilitate exports of natural gas.
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