Israel first hit the international stage as an oil and gas country in 2003, when Houston-based Noble Energy discovered the Mari-B field. The Tamar and Leviathan fields were discovered 2009-2011. All are located in the Levant basin, which encompasses about 83,000sq mi and is situated predominantly in Israeli waters, with a smaller area offshore Cyprus, Lebanon, and Syria.
The Tamar field was Israel’s first large-scale hydrocarbon resource, containing an estimated 9 Tcf 
gross natural gas. The Leviathan field is estimated to hold 19 Tcf gross and is the largest natural gas discovery of the last decade. It is expected to supply gas to Israel’s domestic market as early as 2015. Noble Energy has made six consecutive discoveries in the Eastern Mediterranean with over 35 Tcf gross reserves.
In a report released April 8, 2010, the US Geological Survey estimated 1.7 billion bbl oil recoverable and 122 Tcf of recoverable gas in the Levant basin.
Energy development is so new to Israel that for many years, the country thought of itself as the only country in the region without oil and gas. Former Israeli Prime Minister Golda Meir's famous quote about Moses leading his people to "the one place in the Middle East that has no oil," was recalled by Deputy Consul General Maya Kadosh, while speaking in Houston recently on the state of the Israeli energy sector, hosted by the Center for Energy Economics (CEE) and the Texas Bureau of Economic Geology (BEG).
Just 10 years ago, Israel was a coal nation, and 80% of the country’s power was sourced from the fossil fuel, with the remaining 20% produced by oil.
With a completely different energy landscape in 10 years, Israel is shifting to gas, and it’s doing it very quickly.
“It’s a world record in this aspect,” said Dr. Amit Mor, an energy and environment economist, 
financial analyst, and CEO of Eco Energy, while speaking at the Israeli energy think day. Mor, the former assistant to the Israeli Minister of Energy and Infrastructure, recently headed the team that prepared Israel’s energy master plan.
Natural gas started to penetrate the market in 2004, he explained, and usage increased very quickly to 40% in 2010. This year, usage crept up to 50%. In 2014, he expects to that number to jump again to 60%.
“Now we have gas for 50-60 years, in terms of domestic reserves, and that’s even with the most [pessimistic] figures,” Mor said.
Speaking at October’s Johnson Rice Energy Conference, Noble Energy President and COO Dave Stover heralded the Houston-based company’s presence and progress in the Eastern Mediterranean, saying that between the world-class Tamar and Leviathan projects, regional activities are a “huge success,” with Noble Energy delivering 1 Bcf of natural gas daily, to meet demand.
Stover said that Noble Energy anticipated more play in the area, saying that the Atwood Advantage drillship will be dispatched to the Levant basin, expected to arrive early 2014 to test deep oil potential under each of the existing discovered gas fields. A high-liquid Karish discovery is indicative of Mesozoic oil play in the basin, with Noble Energy currently estimating the gross unrisked resource potential at 3.7 billion boe.
Suddenly finding itself an oil and gas nation, the Republic of Israel is sorting supporting infrastructure, tackling issues that stem from having a sudden glut of resources, which Mor estimated at around 900 bcm.
“The Israeli market will not need more than 450 – 500 bcm maximum until 2040, so there is room for at least 400 bcm, if not more, of export. In this respect, there is plenty of gas available for export, especially from the Leviathan field and other smaller fields since most of the Tamar field is already devoted to the supply of gas for Israel. Some of the gas in Tamar can also be available for export.
Mor said: “Now the big debate is ‘What’s the export vision? How much do we allow for export?’”
Natural gas export seems to be inching closer to reality, with news on Oct. 21 that Israel’s High Court of Justice rejected environmental NGO’s petition against the natural gas export policy. In June, the Cabinet approved 40% exportation of the country’s current reserves.
Israel continues to attract investors and operators. Its Association of Oil and Gas Exploration Industries recently partnered with Universal Oil and Gas (UOG), a London-based company that was created to help internationalize the Israeli oil and gas industry by holding the country’s first major oil and gas exhibition and conference. The COO of UOG, Joshua Beagelman, and his father, CEO Michael Beagelman, held an event in Houston to educate and promote business partnerships in the oil and gas sectors between the US and Israel.
“We thought it was crying out for an event that showcases that even because the
knowledge base of Israel and its infrastructure is low,” Joshua Beagelman said.
Mor and Beagelman explained Israel’s advantages beyond its gas reserves. The country invests in research and development and is recognized as one of the most entrepreneurial nations in the world. Many innovative green-tech and high-tech companies originate from Israel, Mor said.
Joshua and Michael Beagelman stressed that Israel is a “free and fair society,” with Western culture and contract laws similar to those in the European Union. Joshua Beagelman and Mor pointed out that Israel has one of the most highly-educated societies in the world.
Joshua Beagelman explained that such an educated workforce was waiting for the proper model to adapt, looking to places like Aberdeen, Houston and Norway to fill what he called the “oil and gas skills gap.”
“Houston has the expertise. You cannot replace experience,” Joshua Beagelman said. “You start at the school level, at the degree level, and the right companies come over to develop you… then you have a real interesting situation. That’s an exciting aspect of doing business in Israel.”
Joshua Beagelman pointed to Noble Energy’s work with its partners to get Tamar commercial so quickly, explaining that Noble contributed its expertise to existing educated, skilled Israeli workers.
The government understands the potential for oil and gas and the potential impact of natural gas export on the economy, Beagelman said.
On the other hand, Mor painted a more gloomy picture of Israel’s relationship between exportation and internal exploration: While currently meeting and exceeding in-country demand, there is little incentive for exportation or international business.
“Here, the government does not invest a penny … We’re talking about protection; we’re talking about regulation and industry,” he said, adding that the sizable risk that can accompany offshore development “is all on the investors.”
Security
In Israel’s case, protecting facilities is an issue of extreme importance, given the regional geopolitical situation. Mor cited Israel’s floating storage regasification unit (FSRU), sitting about 15km (6 mi.) offshore, calling it a “sitting duck” for Hezbollah and others.
“This is not a matter of energy security. [It] is a matter of national security,” Mor said. It is an ongoing debate precisely because the defense industry needs hundreds of millions of dollars to provide protection.
Due to Israel’s reliance on one source, currently Tamar, Mor warned of another issue demanding attention from an already-taxed government.
“We shifted so quickly, a world-record in this aspect. I would say too quickly, because of our reliance on one source,” he said, citing when Egypt cut off its gas exportation. While Israel shifted to diesel fairly quickly, Jordan and Syria, on the same pipeline from Egypt, sat in the dark for weeks.
“As we shift more and more power stations to gas, if there are going to be technical problems, strategic problems, or attacks on those facilities, Israel Electric and other new independent power producers will not be able to shift to alternative fuels, and we will sit in the dark. Once a nation sits in the dark for one or two days, I think that politically, [any] government [would] collapse,” Mor said. “It’s something of a national strategic interest to build additional supply routes to develop as soon as possible.” He suggested that the government take the lead on building more entry points to the fields and terminals, rather than waiting for private developers to complete the work.
Currently, Israel has an offshore treatment facility because the people are resistant to terminals being built in the already-densely-populated region. LNG is imported from the 6-mi. offshore FSRU, which is how some Israelis would like to continue. Once again, Mor believes the government should intervene. “The government is not showing determination,” he said. “We want the huge benefits, including the environmental benefit as we see shift from coal to gas … but we need the infrastructure. We cannot have it both ways.”
Gas development – particularly dual pipelines, such as the one shared by Turkey and Cyprus, could have a secondary effect.
“This activity could be a catalyst not for peace, but for cooperation,” Mor said, while calling pipeline options the most politically and commercially attractive solution.
Environment
Finally, Israel is concerned with the environmental effects of further exploration and development, as evidenced by the NGO’s failed attempt to prevent exportation. Israel is a strong player in the high-technology and clean-technology industries, and the country already relies on rooftop solar panels. It also has plans to shift half of its auto fleet to electricity, CNG, and methanol fuels.
Along with a budget increase in case of catastrophe, Mor said that the government is already addressing these concerns by trying to delineate and standardize practices and regulations.
“The government is in the process of legislation of environmental regulations vis a vis oil and gas exploration,” he said. “The idea is to adopt top international regulation so that international companies would be regulated according to the law.”
"During the last decade, Israel took major steps toward energy independence, which will benefit Israel and the entire region," Kadosh said.
Noble Energy operates both Tamar and Leviathan fields. Tamar consortium partners are Isramco Negev 2 (28.75%), Delek Drilling (15.625%), Avner Oil Exploration (15.625%), and Dor Gas Exploration (4%); Noble has a 36% working interest. Noble’s partners in Leviathan are Avner Oil and Gas (22.67%), Delek Drilling (22.67%), and Ratio Oil Exploration (15%). Noble owns a 39.66% working interest in Leviathan.
For information on UOG or the UOG2014 conference, held November 17-20, 2014, visit www.universaloilgas.com.
Map of eastern Mediterranean, courtesy Noble Energy
Image of Dr. Amit Mor, courtesy Consulate General of Israel to the Southwest
Image of Joshua Beagelman, pictured left, and his father Michael holding a bottle of oil from Israel’s first drilling campaign in 1955. Photo courtesy DL Bourgeois Photography
Detailed image of first oil from the Cheletz field, Israel's first oil discovery. Photo courtesy DL Bourgeois Photography
Subscribe
