Environment minister urges halt to Leviathan drilling

Erdan: A spill could hit the Mediterranean beach devastating the marine ecology.

There is little chance of a moratorum on drilling for oil at the Leviathan 1 exploratory well, as Minister of Environmental Protection Gilad Erdan is seeking. In a letter to Minister of National Infrastructures Uzi Landau, Erdan warned of possible environmental harm. He explicitly said that he was referring to oil drilling, not natural gas.

Last week, the Leviathan well reached the first oil-bearing target strata at a depth of 5,800 meter, where Noble Energy Inc. (NYSE: NBL) says that the 3D seismic survey indicates the presence of three billion barrels of oil with a 17% geological chance of success. The second oil-bearing oil strata at a depth of 7,200 may contain 1.7 billion barrels of oil with an 8% geological chance of success.

"We just recently witnessed the environmental catastrophe in the Gulf of Mexico as the result of a spill of 500,000 tons of crude oil from the deepwater well in April 2010. The spill was apparently caused by negligence of the drilling companies. The crude oil contaminated 650 kilometers of beaches, caused massive damage to the tourism and fishing industries in four states of the US, resulting in an estimated $20 billion in economic harm," Erdan wrote.

Erdan says that a much smaller spill from the Leviathan well could cause immense damage to Israel. "If, G-d forbid, oil spills into the sea and spreads to the beaches, it will devastate the marine ecology, paralyzing fishing areas, and cause severe harm to tourism and recreation. No less importantly, it could shut down national infrastructures such as the desalination plants, seaports, and power stations."

Erdan said that Israel has no legislation to manage environmental aspects of offshore oil exploration, because it is being carried out in Israel's exclusive economic zone, not in its territorial waters. He said that the Ministry of Environmental Protection was working on the matter, but until legislation is formulated, he wants drilling at Leviathan to stop.

Erdan told "Globes" that talks between Ministry of Environmental Protection officials and their counterparts at the Ministry of Finance and Ministry of National Infrastructures indicated that there was little chance of stopping the drilling. He nonetheless continues to press for a halt for two or three months.

"Just yesterday, BP stopped drilling in Alaska because of a spill," said Erdan. "There have been talks in recent months to understand our ability to learn the lessons of these spills and how to deal with them. I realized that the Ministry of Environmental Protection does not even have a ship that could reach Leviathan. To my astonishment, the country does not even have the legal authority to approach the oil companies because this isn't territorial waters, but the economic zone."

"Globes": How long do you think it will take to regulate this matter? For how long do you want a moratorium on Leviathan?

Erdan: "A few weeks to a few months. This is a matter of professional know-how obtained with an international company."

But based on our familiarity with Landau, we can already say that he will reject your request.

"I cannot comment on that."

Published by Globes [online], Israel business news - www.globes-online.com - on January 13, 2011

© Copyright of Globes Publisher Itonut (1983) Ltd. 2011

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