IPC: Fields may contain 5.71 trillion cubic feet of gas

Israel Petroleum Company findings show that Mira and Sara fields offshore Haifa have potential to provide large amounts of gas.

September 5, 2010 23:45
2 minute read.
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Israel Petroleum Company announced over the weekend that preliminary findings show that the Mira and Sara fields offshore Haifa may contain a potential of 5.71 trillion cubic feet of natural gas.

IPC, which owns a 13.609% net working interest in two offshore licenses covering approximately 310 square miles in the Levantine Basin, referred to the results of a prospective resource evaluation report prepared by Chapman Petroleum Engineering Ltd.

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The report, prepared at the request of IPC in order to determine the value of the prospects before and after consideration of geologic risk, estimates that the Mira license may hold 4.24 trillion cubic feet of gas and the Sara license may contain 1.47 trillion cubic feet of gas.

IPC said that, based on the potential size of the gas accumulations defined in the report along with the results of the 3-D seismic survey over the Sarah and Mira licenses, the company is moving forward with its partners in identifying the best locations for drilling the first two wells and selecting a drilling contractor and attendant services companies in 2011.

Its partners include Tzahi Sultan’s Modiin Energy LP, which owns a 19.3% stake, and Emanuelle Energy Ltd., which has a 43.3% stake and is owned by Ofer Nimrodi’s Israel Land Energy Ltd. The consortium consists of four other companies, including IDB Investments and the operator, GeoGlobal Resources (India) Inc.

In midday trading on the Tel Aviv Stock Exchange, Modiin jumped 16% to NIS 0.05, soaring 23% over the course of the day closing at NIS 0.053 marking its biggest gain since January 17. Israel Land jumped 17% to NIS 36.15, the highest since November 2007.

“There’s optimism among gasstock investors following the announcement this weekend,” said Saar Golan, a trader at Clal Finance Brokerage Ltd. in Tel Aviv.

Following IPC’s update on the fields, Modiin said it had no knowledge of the announcement before it was made.

In the Chapman report, it was estimated that the unrisked net present value of IPC’s 13.609% interest in the Sara and Myra licenses is between $677 million and $1.4 billion.

The licenses are located close to the areas of discoveries operated by Noble Energy Inc. and Yitzhak Tshuva’s Delek group, such as the Tamar site with an estimated potential of 8.7 trillion cubic feet of gas and the Leviathan prospect which is estimated to contain 16 trillion cubic feet of gas. Avner Oil Exploration LP gained 4.2% to NIS 2.54 and Delek Drilling LP jumped 4.9% to NIS 14.45 amid speculation the operators of the nearby Tamar and Leviathan licenses will also benefit.

Bloomberg contributed to this report.

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