Even more gas than previously thought is likely lurking in the Levant basin,
following a Wednesday announcement of a small but significant additional
prospect just next to the Tamar reservoir.
The new reservoir, called
Tamar Southwest, is expected to contain about 0.7 trillion cubic feet, or about
19 billion cubic meters, of natural gas, Delek Drilling and its Tamar
exploration partners reported to the Tel Aviv Stock Exchange that day.
addition, international oil and gas consulting firm Netherland Sewell and
Associates Inc. (NSAI) has deemed the likelihood of success at Tamar Southwest
to be higher than 70 percent, the TASE report said.
While it is still too
early to reveal an investment decision for gas production on the new reservoir,
the discovery increases the amount of proven gas in the Israeli market, the
Tamar Southwest, as its name indicates, is located
southwest of the much larger, 282-billioncu.m. Tamar reservoir and
southeast of the even larger, roughly 535-billion-cu.m. Leviathan
As the Tamar Southwest gas field is located mostly within the
Tamar license block, but also overlaps with the Eran license block – the block
sandwiched between the Tamar and Leviathan gas fields – Tamar partners will own
an 80% share of Tamar Southwest, while the Leviathan partners will hold a 20%
At Tamar, Houston-based Noble Energy holds 36%, Delek Drilling and
Avner Oil Exploration – both subsidiaries of the Delek Group – each own 15.625%,
while Isramco owns 28.75% and Dor Gas owns 4%.
At Leviathan, Noble Energy
owns 39.66%, Delek Drilling and Avner Oil Exploration each own 22.67% and Ratio
Oil Exploration holds 15%.
According to pre-drilling data presented in
the report to the TASE, the significant risks – if any – involved with drilling
at Tamar Southwest would mainly be technical and operational ones. Later on in
the drilling process used for commercial extractions, there could be a risk that
the permeability of the reservoir rock is not high enough to allow for
sufficient gas flow to achieve commercial significance, the report
So far, the partners are unable to provide an estimated
probability that the reservoir will reach the level of commercial production,
the document said. However, the partners wrote, a study of the resources has
indicated that based on the development of similar gas fields, the reservoir has
a reasonable chance of becoming commercial.
Meanwhile Wednesday, Delek
Drilling, Avner Oil Exploration and Noble Energy announced that they would soon
begin production tests on the Aphrodite A2 reservoir located in Cyprus’s Block
12, according to another report the partners submitted to the TASE.
Energy holds a 70% share of this Cypriot reservoir, while Delek Drilling and
Avner Oil Exploration each hold 15%.
The production tests will begin soon
and will last for about a month, during which the partners will be using an
ENSCO 5006 rig to withdraw up to about 60 million cubic feet per day, the report
The total estimated budget for the production tests is expected to
be about $64 million, the report added.
Also Wednesday, both Delek
Drilling and Avner Oil Exploration reported the results of their 2013 first-half
and second- quarter earnings, indicating significant improvement due to the
ongoing production at the Tamar reservoir.
“The production from the Tamar
reservoir is a very significant growth engine for the Israeli economy,” said
Delek Drilling CEO Yossi Abu. “The production is unequivocally improving the
financial results of the partners in the Tamar project, and in addition will
lead to significant reductions in energy costs for all of Israeli industry, will
contribute to the creation of new jobs and will significantly improve the
In the first half of 2013, Delek Drilling’s net earnings
amounted to $18.2m., as opposed to $8.7m. during the same period last year.
Avner Oil Exploration’s net earnings for the first half of 2013 were $11.8m.,
compared with $5.5m. during the same period last year, according to the
These figures constitute a leap of 109% and 114%,
“We will continue our activities in the exploration and in
the production of oil and gas in order to realize the potential for the benefit
of the Israeli economy and the partnerships,” said Gideon Tadmor, chairman of
Delek Drilling and CEO of Avner Oil Exploration.