The National Resources Administration in the Ministry of Energy and Infrastructure published its revenue report today for the first half of 2024. Revenue from natural gas, minerals, and aggregates royalties in the first half of 2024 was NIS 1.175 billion, up 12% from NIS 1.044 billion in the first half of 2023. Most of the revenue - NIS 1.133 billion was from natural gas royalties, up 12.5% from the corresponding period last year.
The increase in royalties was due to an increase in the amount of production of natural gas for export, an increase in the amount of production of hydrocarbon liquids, as well as an increase in the exchange rate of the dollar. The total revenues from royalties from exports was about NIS 687 million (60.66% of the royalties).
The biggest amount of royalties was from Leviathan
The state's revenues from natural gas has three components: the first, royalties at a rate of about 12.5%, set according to the Petroleum Law from the moment production begins in the reservoir. Management of the collection and control of royalties is carried out in the royalties division of the ministry, and the funds are transferred directly to the state treasury. The second, corporate tax (income tax) at a rate of 23% of the profit, is set according to the Income Tax Ordinance and administered by the Tax Authority - it is also transferred directly to the state treasury. The third, profit tax from natural resources (Sheshinski tax), at a rate of 20%-46.8%, after a return on investment of 150%. This is a special tax established following the Sheshinski Committee report, and is administered by the Tax Authority and transferred to the sovereign wealth fund managed by the Bank of Israel.
The figures show, as expected, that the biggest revenues came from the Leviathan reservoir: about NIS 503 million from production of about 5.47 BCM - up 4.3% from the corresponding period last year. Most of the revenues from Leviathan royalties came from exports (about 88.76%). At the same time, the royalties collected from the Tamar reservoir totaled about NIS 382 million from production of about 4.9 BCM - an increase of only 0.6% from the corresponding period last year.
Royalties collected from the Karish reservoir totaled about NIS 248 million, from production of about 2.77 BCM of natural gas and 1.821 million barrels of hydrocarbon liquids, up about 70%, from revenues in the same period last year, due to increased production.
Published by Globes, Israel business news - en.globes.co.il - on September 15, 2024.
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