Leviathan Partners Raise Annual Natgas Production Forecast

Reuters

JERUSALEM, Feb 25 (Reuters) – The partners developing Israel's massive Leviathan offshore natural gas field increased their annual production forecast on Thursday and said they expect to bring the project online by the end of 2019.

The group led by Texas-based Noble Energy and Israeli conglomerate Delek Group presented a new development plan that calls for 21 billion cubic meters (bcm) of gas production each year, up from 16 bcm in their initial plan.

They also lowered the estimated cost of the project to $5-$6 billion from a previous $6-$7 billion.

Leviathan was discovered in 2010 in the eastern Mediterranean and has estimated reserves of 622 bcm, making it one of the world's largest finds of the past decade. But development has been held up due to regulatory uncertainty in Israel.

The government recently agreed to a framework deal with Noble and Delek to speed up development of Leviathan, though the Supreme Court needs to give a final approval because some opponents have claimed it is unlawful.

The development plan presented on Thursday includes drilling eight wells to be connected by a subsea pipeline to an offshore platform, producing a total of 21 bcm a year.

One exit point capable of handling up to 12 bcm a year will be for Israel, as well as bringing supplies to neighbouring markets in the Palestinian Authority, Jordan and Egypt. A second exit point to handle up to 12 bcm is solely for export.

"We are moving forward as fast as possible to bring gas to market by the end of 2019," Yossi Abu, chief executive of Delek subsidiaries Delek Drilling and Avner Oil Exploration , told Reuters.

(Reporting by Ari Rabinovitch, editing by David Evans)

Copyright 2016 Thomson Reuters. Click for Restrictions.

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