Experts: Australians can help Israeli LNG sector

Australian energy giant, Woodside, is expected to secure a large stake of Israel’s 535-billion cubic meter Leviathan basin.

June 12, 2013 03:29
3 minute read.
Leviathan holds 453 billion cu.m. of gas.

Leviathan 521. (photo credit: Albatross)

The expertise of Australian energy firms in hydrocarbon development could be of tremendous value to Israeli firms as they move forward with natural gas exploration – particularly with export mechanisms, experts from both countries agreed on Tuesday.

Representatives from both Israeli and Australian energy companies met in Tel Aviv over breakfast to discuss potential means of cooperation going forward, as part of a week long mission of an Australian oil and gas delegation visiting the country this week. Their visit, which is occurring in order to foster such partnerships, is co-sponsored by the Australian Trade Commission (Austrade) and the Israel-Australia, New Zealand and Oceania Chamber of Commerce. They also met with government officials and oil and gas industry stakeholders.

“With the recent discovery and rapid development of energy infrastructure projects in Israel, there are significant opportunities for Australian suppliers of technology, services, equipment and training to access supply chains in the oil and gas market,” said Eric Goldberg, Austrade’s Tel Aviv representative, prior to the Tuesday meeting.

One Australian energy giant, Woodside, is already expected to secure a 30 percent stake of Israel’s 535-billion cubic meter Leviathan basin in the near future.

Kevin McCann, chairman of the Australian firm Origin Energy Limited and the mission leader of the delegation, stressed that Israel could particularly benefit from working with Australian companies when developing its natural gas export industry.

“I think the Australian companies, in the area of providing services, would be very well qualified to help Israel with this project,” McCann told The Jerusalem Post. “We’ve got the expertise, we’ve undertaken these projects… We can do the civil works and we can do the subsurface sea work.”

Australia, McCann explained, has an unlimited natural gas export policy, which he said has driven more and more exploration to occur in the country’s waters. While environmentalists have blamed this robust export policy on the lack of domestic natural gas in Australia, McCann said that so much more financial benefit comes from exporting the gas. The vast majority of Australian electricity is still generated through coal sources, but the country has “a legally mandated renewable energy target” of 28 percent by the year 2020, he explained.

“Renewables have displaced gas, and coal has hardly been affected,” McCann said.

Placing a limit on Australian natural gas exports would “prohibit further exploration of gas,” he warned, emphasizing how a free export policy stimulates more exploration and growth.

In Israel, the government still has yet to decide on an export policy for its Mediterranean natural gas finds, despite the fact that the Zemach Committee – headed by Energy and Water Ministry directorgeneral Shaul Zemach – recommended that the government limit exports to 500 billion cubic meters and maintain at least 450 at home. Environmentalists have argued that this export cap is too liberal and that much more gas must be reserved for uses at home: Such as clean energy production, gas-based transportation and the petrochemicals industry.

Assuming that Israel does choose to export gas, the country faces a number of options – exporting through pipelines regionally or through Turkey, constructing a liquefied natural gas plant for export of the gas further abroad or making use of such an LNG plant in the works in Cyprus. If the government decides that an LNG facility at home is the correct option, McCann stressed that Australian expertise in the industry could be invaluable.

An LNG facility onshore, meanwhile, would be much more profitable to Israel than constructing a floating station offshore, despite environmental concerns about infringing upon a depleting coastline, he said.

With an onshore facility, the operating companies could employ Israeli civil works teams and Israeli engineers; whereas, a floating LNG plant would likely employ only foreign labor, McCann explained.

In Australia, construction of LNG facilities onshore faces much less environmental opposition due to the companies’ ability to locate them in unpopulated areas.

“You face the problem of a more consolidated community,” McCann said.

In order to appease environmental concerns, McCann suggested creating a buffer zone of several hundred hectares, if possible, around the station – a zone that could contain wild flora and fauna but would be more distant from residential populations.

Making use of a future LNG facility planned for the island of Cyprus, which also has natural gas deposits in its waters, could also be ideal if the government deems constructing a plant in Israel to be too problematic, he added.

Related Content

Holland Park’s forest, north of Eilat.
August 11, 2014
Promising trend of prosecution for environmental crimes, officials say


Cookie Settings