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Israel announces new oil and gas exploration round in the eastern Mediterranean

Nov 5,2018

Israel will tender off nineteen new offshore blocks to oil and gas companies, its energy ministry said on November 4th, hoping to recover from a dismaying auction round last year.

 

Israel located in 2009 that it had huge reserves of natural gas off its Mediterranean coast.

 

It will publish details of the tender by the end of November and, about half a year later, choose the winning companies, said Udi Adiri, the ministry’s director general. Last year’s bidding drew bids from only two groups of companies, and the ministry said it expects more to compete this time as conditions have improved.

 

In 2017 the energy market was weaker and companies, in general, we're investing less. There was also concern over where to sell any newfound gas since Israel is a small market.

 

The nineteen blocks have been divided into 4 sectors that will have an advantage from more comprehensive geological studies than last time. Israel has also signed major export deals with Jordan and Egypt over the past 2 years, opening new markets to companies looking to sell gas from Israel.

 

Adiri further said conditions in the world energy market have improved with companies willing to make more investments. The exploration licenses will be for 3 years, with options to extend up to 4 more years, should terms be met.

 

There have been 7 natural gas discoveries in Israeli waters, though not all have been developed. The Tamar field has been producing gas since 2013 and the huge Leviathan projects, as well as 2 smaller fields, are expected to come in line in the next few years.

 

Last year Israel received bids from Energean and Indian Association firms including Oil and Natural Gas Corporation Videsh, Bharat PetroResources, Indian Oil Corporation, and Oil India.