Israel mulls future gas strategy
Supply and demand scenarios underpin recommendations on the fate of as-yet-undiscovered gasfields
Israel's future gas supply and export strategy could shift as a result of an inter-ministerial team's estimates on demand and supply up to 2042.


,Gina Cohen,petroleum economist-January 2019

A committee led by Udi Adiri, director general of the Ministry of Energy, has published findings of a months-long study on the Israeli gas market.

It is drawn from data generated in the past five years since the Tamar field (with estimated reserves of 10 trillion cf) came on line. Previous recommendations, such as the Zemach committee's report in 2013, were drawn from estimates using only previously discovered fields.

Two facts stand out from the Adiri committee's findings: the first is that Israel has consumed less gas than was forecast: 43 bn cm compared to the 49 bn cm predicted, out of which 40 bn cm was from Tamar (and the rest was imported LNG). The second is that despite the huge discoveries made in offshore Israel in 2009-10, no exploration wells were drilled there in the past five years.

The committee's recommendations (which need to be endorsed by the government) are based on annual and hourly consumption forecasts. In total, these state a requirement of 500 bn cm of gas for the local market until 2042 (out of the 900-1,000 bn cm discovered to date), and are based on a number of consumption assumptions, for different periods and sectors.

On an hourly basis, the committee predicts potential shortages between 2030 and 2040.

The assumptions have implications for Israel’s future energy basket, particularly considering plans to reach an 83pc natural gas and 17pc renewables mix by 2030, and the gradual phasing out of coal by that year.

Future gas discoveries
The Ministry of Energy launched an offshore licensing round in November for 19 blocks, with bids due to be submitted in June 2019. The authorities recommended that new discoveries of less than 50 bn cm need not be connected to and/or supply gas to the local market.

Every other category of field had more or less stringent requirements (see table below), while a lot of leeway has been given to the Petroleum Commissioner to allow new medium-size fields (50-150 bn cm) to delay connecting to the shore until a later date.

The following are the Adiri Committee’s requirements for yet-to-be-discovered fields, preserving 500 bn cm for the next 25 years: