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The gas export agreement to Europe is expected to be signed in the summer: "A huge economic opportunity" | Israel today

2022-05-28T20:55:01.322Z


Following the publication in "Israel Today" about the export of Israeli gas to Europe, the CEO of one of the companies in the Levitan reservoir reassures: "There is plenty of gas" • "We are examining a ship that leaks gas"


As reported in "Israel Today" last week, Israel and the European Union are in accelerated negotiations on the sale of Israeli gas to Europe through Egypt, and it is estimated that the intergovernmental framework agreement will be signed during the summer.

As part of the attempt to diversify energy sources, the Europeans have already contacted the Egyptian Minister of Energy, Tarek al-Mula, and the Israeli Minister of Energy, Karin Elharar, and if there are no special incidents, the Israeli gas will arrive in Europe this winter.

It seems that the fastest and most reasonable way to export gas to Europe is through the liquefaction facilities located in Egypt.

Israel already supplies gas through an existing pipeline to Egypt - where, in Egyptian liquefaction facilities, the gas becomes liquid and passes through special tankers to Europe.

Most of the gas for export will come from the Levitan reservoir, where three companies are partners - Ratio Energies, Chevron and New Med, formerly Delek Drilling.

"Exporting natural gas to Europe is a tremendous economic and political opportunity for Israel. However, in order to enable it on a significant scale over the years, the mobilization of all parties, including government officials, is required to ensure a supportive regulatory envelope," said Yitzal Landau, CEO of Israel Today. Energies, which holds 25% of the Whale Reservoir. 

Gas rig, archive, Photo: Coco

"We will double the quantities"

However, you should cool down the enthusiasm a bit.

The quantities that Israel can supply to Europe are a drop in the ocean compared to the Union's total gas consumption.

The industry estimates that Israel will be able to export 7-6 BCM per year, while Europe's total consumption is about 520 BCM natural gas, of which about 60% -50% of the quantity is imported gas.

Can Israel at all help Europe in the gas crisis that has arisen, or are we too small?

"To tell the truth, we are too small to solve all the Union's energy problems, but we can be a stable and reliable player in diversifying and supplying certain quantities to the continent. These are small quantities. "

In what way can we export to Europe?

"The pipeline project to Europe is very complex in engineering, very expensive, and can take years. There is a possibility of a relatively short pipeline between Whale and Turkey - 500 km, but here first of all decisions have to be made between governments.

And in any case - all these things are not in the immediate term, it takes many years to plan and execute, and billions of dollars to invest.

"The EU has changed its mind and defined natural gas as green energy, it has financial significance that once natural gas is not defined as green energy - financial institutions refrain from funding such projects. Europe relied too quickly on renewable energies that have not yet reached the appropriate level of maturity. "Be dependent on gas imports from Russia. The price of gas there currently reaches $ 50-30 per unit of energy, and in our case the gas contracts are long-term and at very low prices, less than $ 5." 

What should the state do to encourage investment in gas?

"Such an industry of massive investments of billions is about long-term sales contracts, and the most important thing is stability - not to come up with a different idea every day, the industry is unable to absorb it. Any regulatory change will make new companies fail, and companies already in the Israeli market - Think twice before deciding on additional investments, and we have plans for additional investments.Today Whale produces 12 BCM a year, more than half goes to exports.

"We have plans to double the amount of gas produced, the amount of gas in Whale will be enough for 50 years. Doubling the amount of gas produced requires investments of billions: these are production drilling, investment in additional piping to Egypt or alternatively bringing a floating sewage facility."

Is it possible for Israel to have its own sewage facility?

"One of the alternatives we are seriously considering is a ship that leaks gas. A floating drainage facility requires a multi-billion dollar investment that can also contribute billions of dollars to companies, and of course to our senior partner which is the state, and the public will benefit from it. Regulatory and not every moment someone changes his mind - yes to export, no to export, - yes we open new areas for exploration, we do not open. Such changes drive investment. Very simple. All companies operating in the industry work for profit, not for another purpose, The stability of the entire chain of operations stops.

The gas rig in front of Dor Beach, Photo: Michel Dot Com

"Just as there are liquefaction plants in Egypt that take natural gas and turn it into liquid so that it can be transported by special tankers by sea to Europe - so there is technology in Brazil and elsewhere of such a plant on a ship, then there are no licensing procedures to set up such a plant on land, no demonstrations of "Residents and more. The ship can be several tens of kilometers deep and not disturb anyone."

Do not depend on anyone

What are the benefits of a floating drainage facility for Israel?

"One of the advantages is that if there is such a liquid ship, then Israel will not be dependent on either Egypt or Turkey, meaning that Israel will be completely independent in terms of exports, will not be dependent on political-political changes. But such a project could take several years to implement." .

Will there be a shortage of gas in the summer?

"There is gas in Israel for 50 years, there is plenty of gas, there will be no shortage of gas neither in summer nor in any other period. We know how to prepare in advance. There is unequivocally no shortage of gas."

Have you reduced the quantities of exports?

"We have not changed quantities for export - on the contrary, in interim periods like now we are increasing exports to Egypt, so that in the summer if there is a point need to reduce exports - it will not hurt our contracts with them."

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Fixed!

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Source: israelhayom

All news articles on 2022-05-28

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