Israel Natural Gas Lines starts work on LNG buoy

Israel Natural Gas Lines (INGL) officially launched its work building a natural gas marine absorption buoy, which by November this year should be capable of supplying 2-3 billion cu.m. of natural gas to Israel annually.

“The construction of a marine buoy for natural gas absorption is an important strategic move in the framework of a natural project being led by the Energy and Water Ministry – ‘Bringing the Gas to Land,’” said Energy and Water Minister Uzi Landau. “Its goal – providing stability, reliability and security in the energy market.”

Landau visited the worksite of the buoy on Tuesday morning aboard the Seminole ship, which INGL is using as a work platform to construct the natural gas absorption buoy, approximately 10 km. off the coast of Hadera. During the event – organized by the Energy and Water Ministry in partnership with INGL – officials held a ceremony to mark the opening of construction work and gave a progress report of the work thus far.

Joining Landau on the boat were officials from INGL, the ministry’s Natural Gas Authority, the Public Utility Authority, Israel Electric Corporation and other Energy and Water ministry representatives.

INGL is a wholly government-owned corporation, established in 2003, receiving a license for operation of the country’s natural gas system for the next 30 years, according to the company.

Due to Israel’s anticipated natural gas shortage, Landau had directed his office to formulate a solution that would bridge the gap between the depletion of the current Yam Tethys reservoir and the onset of a regular supply from the Tamar reservoir – expected to come online in 2013. The final decision was to construct a buoy, something which became increasingly critical as frequent interruptions of the Egyptian natural gas supply and its eventual complete termination occurred, a joint statement from INGL and the ministry said.

Once construction of the buoy is complete this fall, a gassing ship will then be able to connect to the buoy, providing it with Liquefied Natural Gas (LNG), which will then be transferred to the natural gas transmission system of Israel, the statement explained.

About a year ago the minister had first instructed INGL to erect a buoy through which the country could eventually receive 2-3 billion cu.m. of natural gas per year. Simultaneously, Landau directed the IEC to lease a gassing ship, according to the ministry. In February, INGL finished its National Master Plan and recently received building permit for the construction – allowing construction to begin “at record pace,” which the parties involved attributed to the cooperation among government officials.

The buoy is of the type called Submerged Turret Loading Buoy, and through it gassing ships will be able to unload natural gas directly into the country’s natural gas transmission system. Design, manufacture and construction of the buoy is occurring through the Italian company MICOPERI, after the government signed a NIS 500 million agreement with the firm in 2011.

“This project alone will provide almost half of the amount of natural gas annually required to generate electricity in the State of Israel,” said Landau, who called the new reception facility “an oxygen tube for the sector.”

“This is a facility that increases the country’s ability to maintain a continuous supply of energy to the power and industrial plants, and provides a network of security and independence for the energy market, especially in light of developments in Egypt, which affected the regular supply of gas to Israel,” Landau added.

Ron Chaimovski, INGL chairman, agreed that “this is a strategically important facility,” in a period of natural gas shortage.

“This project gives Israel the ability to import natural gas in a short timetable,” Chaimovski said.

Officials expect that work on the buoy will be complete by November 2012, according to INGL CEO, Samuel Turgeman.

“Immediately upon completion of the construction of the buoy, the State of Israel will be able to receive natural gas from an additional source and will not need to be satisfied with one single gas pipeline currently active,” Turgeman said.