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Israeli group finds signs of large east Mediterranean gas field

Reuters , Sunday 17 Jan 2016
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An Israeli exploration group has discovered signs of another large natural gas field off Israel's coast, it said on Sunday.

A number of the world's biggest gas deposits have been found offshore Israel, Egypt and Cyprus in recent years, and oil and gas companies have been spending money to find more.

A group lead by Isramco Negev and Modiin Energy said a resource report showed there could be an estimated total of 8.9 trillion cubic feet (tcf) of natural gas at the Daniel East and West fields.

"Gas reserves of this size could significantly change the Israeli gas market," said Tzahi Sultan, one of the owners of Modiin, whose shares soared 479 percent after the announcement.

Israeli Energy Minister Yuval Steinitz has said experts estimate there are between 10,000 and 15,000 billion cubic metres (bcm) of gas in the east Mediterranean basin that includes Israel, Egypt and Cyprus -- enough to supply domestic needs as well as Europe.

Isramco, which already has a stake in a second gas field of a similar size, Tamar, was trading up 7.2 percent.

The government has been under pressure from regulators, lawmakers and the public to open the sector to competition. The new field, if confirmed, will do that.

Until now the sector has been dominated by a partnership of Noble Energy and Delek Group, which controls both Tamar and the much larger Leviathan fields.

The resource report gave a "best estimate" for the Daniel East field of 1.1 tcf of gas with a probability for success of 38 to 43 percent. For Daniel West it gave 7.8 tcf with a probability for success of 24 to 57 percent.

Isramco owns a 75 percent stake in the Daniel licenses and Modiin has a 15 percent stake. The companies ATP Oil and Gas and AGR each have a 5 percent share. 

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