Israeli Gas Finds Could Prove a Game Changer: Sparks Fly over Israel's Discovery of Vast Gas Fields under the Eastern Mediterranean, Threatening to Ignite New Hostilities with Lebanon and Syria
Blanche, Ed, The Middle East
THE DISCOVERY OF HUGE NATURAL GAS deposits in the eastern Mediterranean off Israel, and the possibility that Lebanon, Syria and the Gaza Strip may also have substantial offshore riches as well, has added a potentially explosive dimension to the already complex crisis in the Middle East.
The gas finds, which may turn out to be even bigger than current estimates, are "nothing short of a geopolitical game changer," says Gal Luft, executive director of the US-based Institute for the Analysis of Global Security. "Altogether the basin in the eastern Mediterranean ... could contain an amount of gas equivalent to one fifth of US natural gas reserves."
And the stakes just keep getting higher. The size of Israel's gas bonanza is currently pegged at recoverable reserves of around 25 trillion cubic feet. That's enough to transform the Jewish state's economy and guarantee the country, dependent on imported energy since it was founded in 1948, energy security for 50 years.
It could also turn the country into one of the world's top 10 gas exporters for up to three decades at least. Prime Minister Binyamin Netanyahu has already proposed building an underwater pipeline to Greece to plug into the European Union's network to help the bloc cut its dependence on Russian gas.
Now Noble Energy of Houston, Texas, the leading partner in the US-Israeli consortium which made the discoveries starting in January 2009, claims that the huge Leviathan field, the biggest of the three found so far, with an estimated 16 trillion cubic feet of gas, could also contain 4.3 billion barrels of oil.
Noble, which operates with an Israeli consortium led by the Delek Group owned by Israeli billionaire Yitzhak Tshuva, says Israeli offshore reserves could eventually top 30 trillion cubic feet, double the size of Britain's giant North Sea gas fields. If that proves to be correct, Israel's gas would have a conservative value of $300 billion to possibly $400 billion.
Noble is bringing in a drilling platform from the Gulf of Mexico to step up exploration. Gas production is scheduled to begin at the Tamar field, with reserves of eight trillion cubic feet of gas, in 2012, although energy industry insiders say 2014-15 is more likely.
Earlier this year, a study by the US Geological Survey estimated there is up to 122 trillion cubic feet of recoverable gas off the coasts of Syria, Lebanon, Israel and Gaza.
If Syria, Israel's longtime foe, finds gas in the quantities found by Israel, its economic transformation would add a whole new dynamic to the geopolitics of the region, and that would not necessarily advance the cause of peace.
The continental shelf extends eastwards to Egypt, where the state-run General Petroleum Corporation recently signed an agreement with BP to develop two offshore fields containing an estimated 176 trillion cubic feet of gas.
But the offshore finds may also become a casus belli as Lebanon, Israel's northern neighbour and one of the Middle East's longtime battlegrounds, lays claim to the gas fields as well.
Beirut's As Safir newspaper reported in June that the Leviathan field extends northwards into Lebanese waters, aggravating the hostility between these two historically resource-poor countries which have been in a state of war since 1948.
The oil and gas reserves have gone undiscovered for so long because western companies did not want to antagonise Arab producers including Saudi Arabia, Iraq and Kuwait by working with Israel. Besides, companies were reluctant to invest in a region constantly gripped by war and unrest.
But now that the cat's out of the bag, Israel and Lebanon seem set to go toe-to-toe over the energy wealth now within their grasp.
"I see this becoming a source of considerable tension until the location and scale of the reservoirs are better understood," said Catherine Hunter, Levant energy analyst for the Global IHS Group of London. …