tamar offshore gas field_311.
(photo credit: Courtesy)
Clal Finance investment house predicts that Jordan will buy natural gas from
Israel, as the Tamar offshore project looks likely to meet its timetable, while
problems continue to surround the supply of gas from Egypt.
estimation, the lack of faith in Egyptian gas will force Jordan to purchase at
least 1 billion cubic meters of gas from Israel each year,” Clal Finance analyst
Yaron Zar wrote in a report published Thursday. “Jordan consumes about 3 billion
cubic meters of gas a year, of which a small amount is produced at home and the
rest comes from Egypt.”
Zar repeated his “outperform” recommendation for
Tamar partner Isramco Ltd.
Tamar is located 90 kilometers west of Haifa
and has an estimated 8.7 trillion cubic feet of natural gas. Analysts expect it
to be able to provide for domestic Israeli consumption, before Leviathan, with
an estimated 16 trillion cubic feet, turns Israel into a major natural-gas
exporter in several years.
Zar warned that development was being held
back a little by construction of the project’s second production rig in Texas.
Worries over price controls on natural gas have been exaggerated, he said “The
price of gas in our model for Tamar, at $5.50 per million British Thermal Units,
and rising by one percent a year, is conservative,” Zar wrote in the report.
“Price controls, if applied, will not be an effective restriction with regard to
our model’s assumptions. The latest deals by Yam Tethys [drilling platform
located offshore of Ashkelon and a main source of Israel’s current reserves] of
over $8 are not representative of Tamar.”
The report came a day after
Egyptian daily Al-Ahram reported an official from the Egypt Gas Holding Company
as saying gas supplies to Israel and Jordan have resumed after the pipelines
were fixed. Although the gas is flowing to Israel and Jordan, this does not
imply that the export of gas will continue at the same discounted rates, the
A meeting was set to take place Thursday with officials
from the East Mediterranean Gas Company, which is responsible for supplying
Egyptian natural gas to Israel, to tie the price of gas exports to international
prices, he said.
The Al-Ahram report said an Egypt delegation was in
Jordan to discuss raising the price of gas exported to that country, so that it
does not favor any particular country or company.
Ampal-American Israel Corporation, a shareholder in the East Mediterranean Gas
company, announced to the Tel Aviv Stock Exchange that EMG would try to renew
gas flow to Israel, two months after a blast at one of its Sinai pipelines
halted supply to Israel and Jordan.Globes contributed to this report.