Offshore Gas Reserves: Stake Your Claim
by Peter Eyre on 01 Aug 2009 0 Comment

Israel lays claim to huge offshore gas reserves, but could this field extend into Lebanon’s Exclusive Economic Zone (EEZ) and could Lebanon succumb to the same treatment as the people of Gaza? This year Israel had some very promising news from the American company drilling in its offshore waters. Noble Energy announced a significant natural gas discovery in its Tamar prospect situated in the Matan license, offshore Israel. The Tamar #1 well is located in approximately 5,500 feet of water and consists of three high-quality reservoirs.

The project is a US-Israel consortium consisting of Delek Drilling (15.6%), Avner Oil Exploration (15.6), Isramco Negev 2 (28.7), Dor Gas Exploration (4%) and the US drilling company Noble Energy Inc (36%) .

According to Noble Energy’s CEO, “The thickness and quality of the reservoirs encountered were greater than anticipated at the well location. This is one of the most significant prospects that we have ever tested and appears to be the largest discovery in the company's history.” Needless to say, Israel is delighted with this latest find as it could be the start of their independence in Natural Gas.

Further tests are still being carried out and if the Tamar find proves correct, this will secure half of Israel’s gas requirements for the next 20 years. One can only assume that Israel would still require the balance to come from the Gaza field or elsewhere. According to the report, this will reduce dependency on imported oil/coal from such places as Mexico, Norway and Russia.

Israel has made a long term commitment to convert to natural gas and therefore urgently needs to explore for more reserves in order to secure its energy future.

Previously the Israeli Petroleum Commissioner calculated that Israel had some 3–5 trillion Cubic Feet of proven gas reserves in offshore Gaza, which he stated was enough to supply Israel’s current electricity network for 25 years. Israel’s latest find in Tamar could amount to the same volume or possibly much more.

Despite Israel’s vast offshore area, most activities happen to be at both extremities of their zone. In the North, we see them drilling almost on the border with Lebanon and in the South, we see them drilling on the border with Gaza. I have seen this scenario in many other regions of the world, whereby a company drills close to international borders in order to stake claim. In some cases, concerns have been raised that such techniques are not only considered intimidating, but also have the potential to drill under such borders and exploit someone else’s oil or gas reserves. I recall such claims being made on the Kuwait-Iraq border and in the Timor Sea on the Australian-Indonesian border. 

With this uncertainty in mind, we now have a situation developing that could cause similar concerns to both the Lebanese Government and the local authorities in Gaza. The Tamar field in the North could possible stagger the border with Lebanon and, should this be the case, then internationally speaking the reserves would be jointly owned. In the South, we have exactly the same situation between the Gaza Marine Area and adjacent Israeli waters. 

This uncertainty is totally unacceptable and should never be allowed to develop. Oil and gas exploration companies and their respective contracted governments should always look for more diplomatic ways of carrying out such exploration projects, especially in such politically sensitive areas. It could be considered both intimidating and most undiplomatic if such activities take place without consultation with the adjacent country.

To give an example, we can look at the situation developing further South. At the moment, the Israelis are pumping gas from their Mari-B well to onshore Israel. This gas field sits right on the Gaza border and one could ask the same question, does the Mari-B field extend into Gaza? To the West of this commercial gas field are other explored reserves known as Noa and Noa South. In the case of the latter two, these reserves do stagger the border with Gaza and therefore should be considered as jointly owned.

Let’s now consider the intention of Israel to bring the Noa and Noa South wells into commercial production. The companies involved can create a sub-sea connection between the existing Mari-B system to the above wells and the entire gas reserves would then flow directly to onshore Israel without any involvement or knowledge of the authorities in Gaza / Palestine, who legally jointly own them!

Lebanon may well end up with this same scenario, if the gas field does extend into their territory. Both sides would have to decide how to allocate such reserves, as it would not be commercially viable to duplicate plants and pipelines for pumping gas to their respective markets. It is important to remember that, despite the differences between the two countries, it is to their own economic advantage to joint venture. Natural gas is perfect for running all the power stations (after converting them to run on industrial gas turbines) and has the potential to run desalination plants that normally require huge amounts of energy.

Natural gas can run all public transport systems, all major industrial complexes and provide domestic gas for every household. Any surplus gas can be converted to Liquefied Natural Gas (LNG) for export. This would not only bring high tech facilities to Lebanon and Gaza, but would also create many jobs. In the case of Gaza and the West Bank, local gas would bring independence from Israel, which supplies all their electricity. The Palestinians had already planned to use their offshore gas at three new power stations they intended to build, but it is obvious that Israel would never allow them to pipe their own resources directly into onshore Gaza.

The current offshore situation in the Eastern Mediterranean offers unimaginable potential for the discovery and production of oil and gas for the entire region. I would even be bold enough to say that the region could hold prolific amounts of both oil and gas. The seabed contains extremely thick salt encrusted layers that stem back to the time when the Mediterranean Sea dried up. It is perfectly logical that under these dense thick layers of salt and beyond the gas reserves, are vast reserves of oil. The question would be, are drilling companies prepared to spend much more time and money and drill deeper?

The region is a hot bed of activity, geologically speaking, with rifts and fault lines extending in many directions. What is interesting about the East Med region is that once you have located such oil and gas reserves, they have a natural ability to recharge themselves time and time again, as a result of the geological activity going on below.

The problem in the South (Gaza) has truly been allowed to get out of control under the watchful eye of the United Nations, which has been very critical of Israel. Israel blatantly ignores the UN and is also in violation of the Oslo Accord by the exploitation of Palestine’s natural resources and the allocated fishing limits. We could see these same problems occurring on the Israeli-Lebanon border with potential conflict between the two countries, which at best is already strained.

In order to resolve these issues we have to ask the question how can we address the many problems that exist? Firstly the governments of Lebanon, Gaza and West Bank could unite in a common goal both politically and legally, as they both share the same problems. Lebanon has a distinct advantage over Gaza, which no longer has the infrastructure to deal with such legal issues, especially when they are alienated from the rest of the world.

If the legal fraternity in Lebanon offered help to the people of Gaza and the West Bank, they could all sit down together and find a way of taking Israel to The United Nations Convention on the Law of the Sea (UNCLOS) and the International Court of Justice. This action alone would finally clarify international borders and challenge the legal ownership of any disputed oil and gas reserves and at the same time help Gaza recover its lost fishing zone that is so vital to its people.

It is imperative that both Lebanon and Palestine in their own right participate in current and future oil and gas exploration programmes by carrying out Joint Ventures (JV) with international drilling companies. These JV should show the owners of such potential reserves as being the majority share holder, which was not the case in Gaza.    

Such actions should be taken without delay in order to challenge the Israeli claim and to ascertain if in fact the Tamar gas field does extend over the border. Should Lebanon prove this to be the case, then legally both countries share in its ownership. With today’s drilling technology, it is extremely easy for a drilling company on the Israeli side to take oil/gas from adjacent waters by using slant/diagonal drilling techniques. 

The map gives some idea of the respective locations of the Tamar Gas Field on the border with Lebanon and the Noa Gas Field to the West of the Mari-B Gas Field which does stagger the border with Gaza. I must draw emphasis to the fact that this map shows bias towards Israel and does not show any of these fields extending into Gazan waters - when in actual fact they do.  

Peter Eyre, a former British Naval officer, worked at NATO headquarters in cryptology, and spent a lot of time in the Middle East and South East Asia as a petroleum consultant; he lives in the UK and writes regularly for the Palestine Telegraph

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