The Middle East’s New Energy Giant

[Geee]

Weekly Standard:

Israelis have always lamented that Moses led the ancient Israelites to the one patch of land in the Middle East bereft of energy resources. It turns out the sea offered more promise. At the end of December, a huge natural gas discovery was confirmed in the Eastern Mediterranean inside Israel’s territorial waters. Once referred to as an “energy island” that not only lacked energy reserves itself but was also cut off from the huge energy resources of the nearby Arab nations, Israel may well become over the next decade an energy exporter. The discovery of the Leviathan gas deposit in the Levant Basin marks a major development for Israel, with the potential for significant economic and strategic advantages, as well as implications for Europe, Russia, and the natural gas market.

Natural gas was first discovered off Israel’s coast in 1999, but the quantity was so small that until recently Israel was still contemplating importing natural gas from Russia by pipeline and liquid natural gas by tanker. Now Jerusalem’s plans are beginning to change. The Leviathan field, discovered by a consortium led by Houston-based Noble Energy, is the world’s largest offshore gas find in the past decade and vaults Israel into the ranks of the largest gas reserve holders in the world. (There are some indications that Leviathan might contain a world-scale oil deposit as well.)

Analysts believe that Leviathan could provide Israel with anywhere from 50-200 years of gas, at current levels of consumption, and more than meet growing demand for decades. In a few years Israel will no longer need gas from Egypt, which since 2008 has fueled 16 percent of Israel’s electricity and provided 40 percent of its natural gas. Israel plans to continue to buy Egyptian gas for the purpose of diversification and political ties, but the recent cutoff following sabotage of the gas pipeline in the Sinai highlights the dangers of dependence on Cairo.