Today's cabinet decision on natural gas exports is different from the proposal submitted by Prime Minister Benjamin Netanyahu in two important ways.
Firstly, the cabinet explicitly decided that gas exports to neighboring countries will come from the export quota and not from the reserves set aside for domestic use. However, in order to allow immediate gas exports to neighboring countries, the cabinet decided to permit the sale of 20 billion cubic meters (BCM) of gas from the Tamar gas field, which began delivering gas in April, without waiting for the Leviathan field to come online. It is important to emphasize that there is currently now technical ability to increase gas flow from Tamar because of the limited capability of the pipeline, unless deliveries to Israeli customers is reduced.
During the cabinet meeting, the ministers learned that gas sales to Jordan and the Palestinian Authority will be much larger than they had expected. Minister Energy and Water Resources Silvan Shalom estimated that gas sales to Jordan and the Palestinian Authority will amount to 100 BCM over 30 years. Minister of Environmental Protection Amir Peretz said in response that these sales should therefore not come from the gas set aside for the Israeli market. He was supported by Minister of Communications Gilad Erdan, Minister of Justice Tzipi Livni, Minister of Health Yael German, and, unexpectedly, Shalom.
The second change was the possibility of building a liquefied natural gas (LNG) plant offshore, basically a floating LNG (FLNG) facility, within Israel's exclusive economic zone, rather than onshore.
Published by Globes [online], Israel business news - www.globes-online.com - on June 23, 2013
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