Leviathan partners plan gas flow by 2019

Leviathan

The Leviathan partners have filed a new plan with the Israeli regulator that includes speeding up development.

The Leviathan partners today filed the latest and expanded version of the gas field's development with the Supervisor of Petroleum at Israel's Ministry of National Infrastructure, Energy and Water Resources.

According to the plan, the development of the offshore gas field will be speeded up with gas and condensates on stream by 2019. In accordance with the gas outline agreement, the investment decision for the project is expected by the end of this year.

The development plan includes eight production drillings connected by an underground pipeline to the platform and rig on which all the gas handling systems will be installed in accordance with the national master plan's instructions approved by the relevant planning authorities. The platform will be linked to the coast by a pipeline built by the Israel Natural Gas lines Co. at the northern entrance on the plan and from there to Israeli onshore customers and for export to neighboring countries. All gas treatment will take place at sea.

Production capacity will be 21 billion cubic meters (BCM) per year 5 BCM more than the original development plan, which called for annual production of 16 BCM. This is due to expected market demand.

The pipeline capacity for the Israeli market and export to neighboring countries will be 12 BCM annually. However, the platform will have an additional point of exit which could go directly to a country in the region and carry another 12 BCM annually.

The development cost until gas begins flowing is $5-6 billion and will be Israel's largest infrastructure project. This is below the initial development cost estimate for the project of $6-7 billion.

Noble Energy Inc. (NYSE: NBL) owns 39.66% of Leviathan, Delek Group Ltd. (TASE: DLEKG) units Avner Oil and Gas LP (TASE: AVNR.L) and Delek Drilling LP (TASE: DEDR.L) each own 22.67% and Ratio Oil Exploration (1992) LP (TASE:RATI.L) owns 15%.

Noble Energy Israel country manager Bini Zomer said, "Since the adoption of the Natural Gas Framework this past December, Noble Energy’s engineers have worked around the clock, both in Israel and in Houston, to create a development plan that answers the challenge posed to us by the MEWR and expedite the flow of natural gas from Leviathan to the domestic Israeli market."

He added, "Today, with the expectation that all stakeholders are beholden to the commitments that were included in the Framework adopted by the Government of Israel, Noble Energy submitted the Leviathan POD which enables the flow of gas to the Israeli shore by the fourth quarter of 2019. Noble is proud, once again, to be partners with the Government of Israel in building an oil and gas industry which promises a reliable and secure source of energy that will provide economic, environmental and geopolitical benefits to the State and her citizens. We are committed to working with all relevant entities to ensure that everyone is committed to the timelines necessary to achieve the ambitious but realistic goal of first gas in the fourth quarter of 2019."

Published by Globes [online], Israel business news - www.globes-online.com - on February 25, 2016

© Copyright of Globes Publisher Itonut (1983) Ltd. 2016

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