January 10, 2013
AN OLD joke?that Moses led his people to the only place in the Middle East without oil?needs updating. Israel may not have oil, but it does have gas. The Tamar gasfield, discovered in 2009 off Israel?s coast, holds great promise. Leviathan, discovered in 2010, holds even more. The US Geological Survey reckons that there could be 120 trillion cubic feet (tcf) of technically recoverable gas in the Levant basin, which washes the shores of Israel, Lebanon, Syria and Cyprus (see map). So far, however, only 35tcf has been located. And as Simon Henderson of the Washington Institute, a think-tank, points out: ?Israel?s initial euphoria? is fading. The region?s political fractiousness does not end at the water?s edge.Israel, which relies heavily on imported energy, has much to gain. The gas discovered so far could satisfy its domestic demand for 20 years, according to the Oxford Institute for Energy Studies. And exports could yield oodles of cash. Cyprus stands to benefit, too, from the 7tcf so far discovered off its coast. It currently generates 95% of its energy with pricey oil; gas would be cheaper, and could be exported.Gas from Tamar is set to start billowing to Israel this year. But further development of Leviathan depends on politics. Nervous nationalists want all the gas to be reserved for Israeli consumers. But that would mean worse returns for the firms that must invest...
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