(photo credit: Courtesy)
“Drilling an oil well is a major technological challenge, and it has never been
done in the East Mediterranean Basin,” Ratio Oil Exploration (1992) LP CEO Yigal
Landau said Monday at the Globes Israel Business Conference.
“Gas is a
separate matter, unrelated to the oil market, and prices do not go hand in hand
either,” he said. “As for oil, there is a pioneering effort under way, which
will have huge repercussions on the entire exploration industry in Israel’s
exclusive economic zone and probably on Cyprus’s as well.”
about the chances of finding oil at the recent offshore gas discoveries, on the
conference’s “Sources of energy-high tension” panel, which discussed the impact
of energy prices on the global economy and Israel’s place in the global energy
market in view of the offshore naturalgas discoveries.
“The chances of
finding oil are currently estimated at 8% – and 16% on the basis of two
prospects,” he said. “These are very low probabilities, which I prefer to call
an engineering challenge. We are trying to weigh all the considerations before
drilling a well.”
Regarding the prospects for gas exports, Landau said:
“A US Geological Service report estimated Israel’s gas discoveries in the Levant
Basin at 120 trillion cubic feet. This requires a lot of development.
export restrictions will doom further gas exploration, because we’re talking
about investments of hundreds of millions of dollars for each
Without the necessary regulatory certainty, which must be settled
fast, a market player cannot continue to develop the fields.”
regulatory problems arising from the government treatment of the oil and gas
industry were harmful.
“The delay in the Sheshinski Committee decisions
contributed to regulatory uncertainty and delayed the development of fields by
Israeli companies with the relevant licenses,” he said. “This resulted in losses
to both the state and the Tamar partners, which lost revenue this
Ratio is a partner in the Leviathan field, along with Noble Energy
Inc. and Delek Group Ltd., which are also partners in the Tamar field.