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Orit Ganor, Director of Natural Gas International Trade, Ministry of Energy, Israel

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Athens Energy Forum 2019 | Panel Discussion 3 | Update on Upstream Developments

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Orit Ganor, Director of Natural Gas International Trade, Ministry of Energy, Israel

  1. 1. Orit Ganor Director of Natural Gas International Trade Israeli Gas Opportunities Athens Energy Forum 28 January, 2019
  2. 2. Outline of Presentation The Israeli Gas Revolution Israel’s Domestic Market Governmental Export Policy Export Options Offshore Bid Rounds
  3. 3. The Israeli Gas Revolution Aphrodite/Ishai Leviathan Dolphin Tanin Karish Gaza Marine Shimshon Noa MariB Dalit Tamar I s r a e l -2000 Tamar SW I s r a e l Legend Drill Oil Field Legend Drill Oil Field Gas Field Production Platform Pipeline under construction
  4. 4. The Israeli Gas Revolution Aphrodite/Ishai Leviathan Dolphin Tanin Karish Gaza Marine Shimshon Noa MariB Dalit Tamar I s r a e l -2000 Tamar SW Legend Drill Oil Field Gas Field Production Platform Pipeline under construction o 2000 - Two small gas fields, Noa and Mari-B were discovered o 2004 - First gas production offshore Israel from Mari-B o 2009-2010 - The giants, Tamar and Leviathan gas fields were discovered in deep water o 2013 – The Karish field was discovered o 2013 - The Tamar field was connected to shore o 2019 – First gas planned to flow from Leviathan o 2021 – First gas planned to flow from Karish, which will be developed using an FPSO
  5. 5. The Israeli Gas Revolution Aphrodite/Ishai Leviathan Dolphin Tanin Karish Gaza Marine Shimshon Noa MariB Dalit Tamar I s r a e l -2000 Tamar SW Legend Drill Oil Field Gas Field Production Platform Pipeline under construction Israel is rapidly adapting to a gas based economy o In 2018, 65% of electricity was generated from gas. o Until 2030, all coal-based electric plants will be closed gradually. o In 2030, 83% of electricity is planned to be generated from gas, and 17% from renewables. o Estimated reserves of natural gas: 604 BCM (2P) and 234 BCM (2C) o Government participation in installing and operating of offshore gas infrastructures.
  6. 6. Israel’s Domestic Market (Natural Gas Authority, 2018) AnnualDemand(BCM) 10.9 10.9 11.0 11.0 11.2 12.8 14.1 14.3 15.6 15.9 17.4 17.9 18.3 18.9 19.6 20.3 21.0 21.7 22.3 23.0 23.7 24.3 24.8 25.3 25.8 0 5 10 15 20 25 30 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 Electricity Sector Industry & Distribution Transportation Petrochemical Industry Total
  7. 7. Governmental Export Policy oDecreasing the obligation to connect every gas field to the domestic market oEnsuring a supply of 500 BCM until 2042 to the domestic market oReducing the amount of gas to be supplied to the domestic market from each field oTaking additional measures to incentivize petroleum exploration and production activity offshore 8
  8. 8. Export Options Jordan * APC-JBC – 3 BCM over 15 years (from Tamar) * NEPCO – 45 BCM over 15 years (from Leviathan) Egypt * Dolphinus – 32 BCM (from Leviathan) * Dolphinus – 32 BCM (from Tamar) EU The EastMed Pipeline System (10-20 BCM/Y) LNG Floating LNG, onshore LNG facility in Israel or Egypt Egypt Jordan Cyprus Greece
  9. 9. Israeli Offshore bid rounds o1st offshore bid-round in 2016-2017. o6 exploration licenses have been awarded oThe 2nd bid round for offshore exploration licenses was launched in November 2018 o19 blocks within 5 zones are offered in areas of high prospectivity
  10. 10. Terms of the 2nd offshore bid round o Similar terms to the 1st offshore bid round o Gradual license terms: 3+2+2 with 2 Drill- or-Drop decision points o Data package includes 3D seismic data o Participation fee of USD 50,000 o Reduced license guarantees
  11. 11. License and Lease Terms o The licensee is expected to perform a non- negotiable approved work program o At least 1 well is required to be drilled in the second license period o In case of discovery Licensee will apply for a production lease o Production leases are granted for 30 years with possible extension of up to 50 years
  12. 12. 2nd Offshore Bid Round - Bids Evaluation Component Determining criteria Weight (%) Workprogram Exploration well Commitment to drill during the first 3-year 40-50 85% New 3D seismic survey Area (km2) 30-40 New 2D seismic survey Length (km) 5 3D reprocessing Area (km2) 10 2D reprocessing Length (km) 2 Other surveys/studies Estimated total expense (USD) 3 General evaluation Operator’s experience and HSE performance; overall impression of the bid; competition considerations 100 5% Signature bonus [Not less than USD 400,000] 100 10% 13
  13. 13. oritg@energy.gov.il www.energy-sea.co.il

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