Noble Energy announced Thursday that it was pushing ahead with the development of Israel’s offshore Leviathan gas field, securing financing for the nearly $4 billion project and planning on bringing it online by 2019.
Leviathan, discovered in 2010, is estimated to hold 18.9 trillion cubic feet (535 billion cubic meters) of natural gas, along with 34.1 million barrels of condensate. Development of its own energy resources is seen as a major strategic asset for Israel, which has no oil and little water.
Nobel, which is partnered with the Israeli firms Delek Drilling and Avner Oil Exploration on Leviathan, set out a timeline that would see drilling begin in 2017 and the first extraction by 2019.
“Noble Energy and partners anticipate drilling one to two Leviathan development wells in 2017,” it said in a statement. “Completion activity for all four producer wells, including two previously drilled, is anticipated in 2018. The Company expects to complete project installation and initiate commissioning in the fourth quarter of 2019, with delivery of first gas targeted for the end of 2019.”
“Bringing Leviathan online will expand Israel’s supply of natural gas, further support the State’s commitment to convert coal-fired power generation facilities to cleaner burning gas, and provide affordable energy resources to Israeli citizens and neighboring countries in the undersupplied region,” David L. Stover, Noble Energy’s chairman, president and CEO, said in a statement.
Israel hopes the development of Leviathan will allow it to export gas, which it says could help grease the wheels of regional diplomacy.
The announcement by Noble Energy was hailed by Prime Minister Benjamin Netanyahu, who has pushed to allow the consortium to control the field, over the objections of opposition lawmakers and activists.
“This is a day of good news for the Israeli economy and Israeli citizens,” Netanyahu wrote on Twitter. “The process will provide gas supply to Israel, and will advance cooperation with regional states.
Netanyahu has made the gas deal a centerpiece of economic his agenda, saying the discovery of large reserves would bring energy self-sufficiency and billions of dollars in tax revenues. But critics say the deal gave excessively favorable terms to the government’s corporate partners.
Regulators have charged that the government’s original deal with Nobel and Delek violated anti-trust laws. In March 2016, Israel’s High Court of Justice shot down the deal’s “stability clause,” in which the government could not impose regulatory changes, such as breakups of suspected monopolies, on the consortium for a full 10 years.
Government ministers in May approved a new version of the deal that included a clause enabling future governments to alter the terms agreed with drilling companies.