Survey Offshore Israel Finds Difficult Reserves

Israeli explorers Isramco Negev and Modiin Energy reported January 17 that a survey by Netherland, Sewell pointed to a potential discovery of 8.9 trillion ft³ of gas in the Daniel Maarav, Daniel Misrah and other geological structures offshore Israel. The data included in the new survey is based on a 3-D seismic survey that was concluded last year and it said the probability of finding gas is 25%-50%, depending on the location. The potential deposit quantity is almost as big as the Tamar field but more challenging, technically and so it will be more expensive to produce.

Both licenses are in deep water, 85-115 km offshore Israel and at a depth of 1,000-1,350 m.

Partners are Isramco Negev (65%), Modiin Energy (15%), Hanal, Israel Oil Company (10%), US ATP – which is now in liquidation (5%) – and Petroleum Services Holdings, a Norwegian services company (5%). Isramco also holds a 29% stake in Tamar.

In a filing to the Tel Aviv Stock Exchange, Isramco and Modiin said that they would look for partners. As there are a few structures in the two licenses, a few costly exploration drillings will have to be carried out. The partners will need a partner with knowledge and experience of deep water operations. Under Israeli law, a project operator must own at least a quarter of the license.

Mixed reactions

Modiin Energy was enthusiastic about the findings but Isramco’s CEO Earn Saar said there was no certainty that the findings would become commercial. He said that the two licenses held 10 different structures and each of them posed different risks and prospects. "The road to a discovery, if at all, is still long," he said. 

Ya'acov Zalel