Gov't officials to learn about Dutch natural gas market

Tamar gas drilling

Israel Antitrust Authority head David Gilo will be among officials visiting Holland next week to learn about their gas sector structure.

A delegation of senior Israeli officials from the Ministry of Finance and the economic regulators will visit the Netherlands next week for a four-day tour in order to learn about the structure of the local natural gas sector. The delegation will include Antitrust Authority director general Prof. David Gilo and chief economist Assaf Eilat, Ministry of Finance budget director Amir Levy and deputy director for infrastructure Udi Adiri, Government Companies Authority director Ori Yogev, Deputy Attorney General Adv. Avi Licht, Public Utilities Authority (Electricity) chairperson Orit Farkash-HaCohen, and National Gas Authority director and Ministry of National Infrastructure, Energy, and Water Resources Petroleum Commissioner Alexander Varshavsky.

The visit was initiated by the National Economic Council, which will be represented by vice chairman Morris Dorfman. The visit comes three weeks after the regulators presented the gas developers with a new structure for the gas industry. The government said that the spade work for the visit began last summer, and the date was set in December in coordination with the Dutch hosts. According to senior government sources, the visit will contribute professional knowledge to the regulators, and help them conduct the negotiations with the gas developers.

The government proposal for a change in the gas sector structure was sparked by Gilo's unexpected decision to retract the compromise agreement reached with the Delek Group Ltd. (TASE: DLEKG)-Noble Energy group.

The Dutch gas sector is similar to the Israeli gas sector in many aspects. A large gas reservoir, the land-based Groningen reservoir, which contains 106 TCF, was discovered in the Netherlands in 1959, and additional smaller reservoirs were later discovered. The Netherlands has also tried to find the right balance of gas exports and sale to the local economy. In order to complete with the large reservoir, the Netherlands designed a policy for providing incentives for the development of smaller fields, including tax benefits, recognition of a higher price for gas, and a government commitment to buy the gas. Natural gas accounts for 60% of electricity production in the Netherlands, and is the primary source for residential heating.

Published by Globes [online], Israel business news - www.globes-online.com - on March 5, 2015

© Copyright of Globes Publisher Itonut (1983) Ltd. 2015

Tamar gas drilling
Tamar gas drilling
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