The exploratory well being drilled into the deepwater Leviathan gas field off the coast of Haifa since October 18 is due to reach the target depth of 5,095 meters, and the moment of truth about the presence of huge gas reserves is approaching. The partners in the Leviathan leases – Noble Energy Inc., Delek Group Ltd. and Ratio Oil Exploration (1992) LP – may announce preliminary findings as soon as Friday.The answer to the question of whether the strata contain natural gas worth an estimated billions of dollars will have far-reaching impact.The immediate answer will come on the Tel Aviv Stock Exchange.The meteoric rise in the share prices of oil and gas exploration partnerships since the discovery of the Tamar reservoir will not be repeated. Many analysts believe the share prices of Ratio and Delek Group units Avner Oil and Gas LP and Delek Drilling LP (the latter two are also partners in Tamar) already include a scenario that the quantities of gas reported by Noble Energy in June will be found.A discovery will lift from the companies the threat of a collapse of their share prices.“Oil and gas shares will continue to be risky,” Clal Finance analyst Yaron Zar said. “But a discovery at Leviathan will turn the partners’ shares into legitimate investments for most investors, subject, of course, to the question of price.”If no signs of gas are found, the companies’ shares will collapse and drag down the entire oil and gas exploration sector, whose aggregate market cap recently peaked at NIS 40 billion.For the companies, investors and analysts, an announcement of a gas discovery is only one question, however important it may be.There are two other questions, just as important, for establishing the economic value of a Leviathan discovery: its effect on the Sheshinski Committee; and the business model for the sale of gas from the reservoir.In other words, how much will be exported, to which markets and at what price, how will the gas be transported, will the companies prefer laying an undersea pipeline to Europe, or will they invest in building a liquid natural-gas terminal for shipping gas to Far East markets. All these questions will remain open only if the Leviathan structure shows signs of gas.If no gas is found, all these questions will become irrelevant.The Finance Ministry, in contrast to the TASE, will receive an announcement of a gas discovery with conflicting feelings. Ministry officials see the gas reserves as a mixed blessing, concerned over the threat of infection from “Dutch Disease”: the effect of expected income from gas exports, or from gas sales on the domestic market instead of importing fuel, on the shekel’s exchange rate.While the Finance Ministry estimates the relative weight of Tamar’s income on the current balance of payments at 10 percent, it believes the weight of Leviathan could reach 25%, which could result in the shekel appreciating to NIS 2-NIS 2.50 to the dollar.Under this scenario, Finance Ministry officials warn about a death knell for export industries and hi-tech – and of massive layoffs among Israel’s best educated and skilled workers.For Finance Minister Yuval Steinitz, the heavy taxes proposed by the Sheshinski Committee are the initial vaccination against Dutch Disease. The second dose is what to do with the revenues.There are several models around the world for sophisticated use of oil and gas revenues: one is to invest directly in transportation and education infrastructures to improve competitiveness; a second is to encourage exporters through tax cuts and other breaks; a third is to improve the national debt ratio and cut interest payments; and a fourth is a sovereign-wealth fund, which will invest the revenues in acceptable channels outside Israel.So far, the inclination of the Finance Ministry and Steinitz is to distribute the revenues among all four channels.