Since the discovery of the Leviathan gas field, Israel is becoming a regional gas power, exporting the natural resource to its main neighbours.
Israel: a new regional gas power
“Gas will revolutionize the entire Israeli economy, to the point where it will become its main engine of growth over the next decade,” It is the prediction of Israeli economist Jacques Bendelac, one which it is hard to disagree with. For instance, gas production already started at the Israeli offshore Leviathan gas field, “the largest energy project in Israeli history”, aimed at making the Hebrew state a regional energy power.
Gas exploitation will revolutionize the Israeli economy
We tend to underestimate the importance of gas fields for Israel. Gas exploitation is not only Israel’s biggest energy project; it has the potential to revolutionize the entire Israeli economy, to the point that it will become its main engine of growth over the next decade. Until now, it was the high-tech sector that was considered to be the engine of the country’s economy, but it has lost momentum and has been losing momentum for 3 or 4 years, in particular because it faces a serious shortage of skilled labour. The discovery of gas is therefore timely for Israel. This hydrocarbon will take over from high-tech and become the locomotive of the Israeli economy during the 2020 decade.
The exploitation of the Leviathan gas field, and the other wells already exploited (Tamar, Mary and Noa), will give a boost to the Israeli economy. First, it will provide a great many jobs, directly or through indirect spinoffs in other sectors. Then, the economy will gain in investment and foreign exchange, as well as in technological innovations related to gas exploitation. In 2020, Israel already benefits from a “green energy” since gas, less polluting than fuel oil, provides 65% of the national electricity production, without counting the numerous industrial companies which turn to gas to run their machines.
Israel begins exploitation of Leviathan gas mega-project
The first thing to know is this: This major energy project would allow the Hebrew state to become a regional energy power. Discovered in 2010, the Leviathan gas field in the Mediterranean contains exploitable resources estimated at around 605 billion m3 of natural gas, according to the Israeli-American consortium which is piloting this project.
A statement from Yossi Abu, CEO of Israeli company Delek, a member of the consortium operating Leviathan, said that “For the first time in its history, Israel is an energy power, at the same time able to suffice its needs, to obtain its energy independence, and to export natural gas to its neighbours in order to strengthen its regional position“.
Israel is becoming a gas exporter
The consortium operating Leviathan has signed an agreement valued at more than 15 billion dollars (13.3 billion euros) with the Egyptian group Dolphinus for the supply of natural gas over 10 years.
Israel has already bought gas from its Egyptian neighbour and sold it to Jordan – the only other Arab country with which the Hebrew State has a peace agreement – but it will be the first time that it exports its blue treasure to the land of the pharaohs. Exporting gas to Egypt is “the most important economic cooperation” between the two countries since the signing of their peace agreement 40 years ago, said Israeli Energy Minister Yuval Steinitz.
Located some 130 km west of the Israeli port of Haifa, Leviathan is connected by two submarine pipelines to its operating platform, located ten kilometres from the coast. The development of the gas field, which required investments of 3.6 billion dollars according to the consortium also formed of the American group Noble, should allow Israel to strengthen its relations with other states of the Mediterranean basin.