Reuters reports from Tel Aviv:
Natural gas from the Tamar field off Israel's Mediterranean shores will begin flowing this weekend, the Energy and Water Ministry said in a statement on Wednesday. It issued the announcement after Silvan Shalom, the energy and water minister, visited the Tamar rig along with Israeli billionaire Yitzhak Tshuva, the controlling shareholder in Delek Group, one of the partners in Tamar.
The natural gas will lead to a reduction in production costs for state utility Israel Electric Corp as well as a decline in the price of electricity, the statement said. "The minister gave his blessing to the flow of gas, which will begin this weekend if there are no mishaps," it added.
Tamar, discovered in 2009, is located 90 kilometres off Israel's northern coast and has an estimated 10 trillion feet of gas. It is one of two major recently found gas fields off Israel that are due to start production in the next few years, the other being the bigger Leviathan field.
Development of the Tamar and Leviathan fields will make Israel less dependent on energy imports but the country has said it will also allow a significant amount of its natural gas to be exported.
Tamar has already signed a number of large deals, including one to supply as much as $23 billion of natural gas to Israel Electric Corp and $4 billion worth to units of conglomerate Israel Corp.
Texas-based Noble Energy holds 36 percent of Tamar. Isramco Negev owns 28.75 percent and Delek Group subsidiaries Avner Oil Exploration and Delek Drilling hold 15.625 percent each. Dor Gas Exploration has a 4 percent stake.
Israel has been suffering from a gas shortage for two years, after a spate of terror attacks on a pipeline delivering Egyptian gas cut off supplies and the Egyptian state-owned gas company reneged on its contract, citing irregularities. That forced Israel's biggest natural-gas user, the Israel Electric Corporation, to turn to more expensive fuels, saddling it with severe cash flow problems, straining its power-generating capacity and damaging the environment.
The start of production at Tamar will not only boost the utility but the economy too. Echoing other forecasters, global investment bank HSBC said this week that natural gas production can be expected to contribute at least one percentage point to Israel's gross product growth this year. HSBC predicted GDP will grow 3.3%, compared with 2.6% without gas from Tamar.