(photo credit: Albatross)
The signs are that the final report of the Tzemach committee will make it easier
for the gas exploration partnerships in Israel to export gas. This represents a
softening of the committee’s stance in its interim report.
the draft final report of the committee on the structure of the gas economy,
headed by Energy and Water Resources Ministry Director- General Shaul Tzemach,
the gas partnerships will be allowed to export more than 50 percent of the gas
reserves they control from any large reserve (more than 200 billion cubic
meters, such as Tamar and Leviathan). Medium-size reserves (100-200m. cubic
meters) will be allowed to export 60%, and small reserves (under 100m. cubic
meters) will be allowed to export as much as 75% of their production.
committee stressed in its report that exports will not come at the expense of
security of supply to domestic consumers.
“The concept that permitting
exports is by way of an alternative to securing the economy’s consumers is
incorrect. Permitting exports of natural gas does not prevent, but rather
promotes, the security of the local economy’s consumers and serves to encourage
the development of a local natural gas-based economy,” it stated.
committee members also warned against hesitation and postponement of
“Unclear government policy does not enable the developers to
make the required decisions and to obtain the vital finance for developing the
reserves, and thus generates uncertainty in the entire value chain of the
natural gas economy, particularly in exploration and development activity. By
way of illustration, postponement of the development of the Leviathan reserve by
one year will lead to direct loss of state revenues of $400-700m., depending on
The draft report also recommended that gas reserves
for the purposes of calculating allowed exports should include both proven and
unproven reserves, so that the gas partnerships will be able to plan exports of
gas from reserves that have not yet been proven as discoveries.
report will also recommend keeping gas reserves sufficient for domestic purposes
for 25 years.