The Tamar gas field is a
natural gas field
A petroleum reservoir or oil and gas reservoir is a subsurface accumulation of hydrocarbons contained in porous or fractured rock formations.
Such reservoirs form when kerogen (ancient plant matter) is created in surrounding rock by the presence ...
in the
Mediterranean Sea
The Mediterranean Sea is a sea connected to the Atlantic Ocean, surrounded by the Mediterranean Basin and almost completely enclosed by land: on the north by Western and Southern Europe and Anatolia, on the south by North Africa, and on the ea ...
off the coast of
Israel
Israel (; he, יִשְׂרָאֵל, ; ar, إِسْرَائِيل, ), officially the State of Israel ( he, מְדִינַת יִשְׂרָאֵל, label=none, translit=Medīnat Yīsrāʾēl; ), is a country in Western Asia. It is situated ...
. The field is located in Israel's
exclusive economic zone, roughly west of
Haifa
Haifa ( he, חֵיפָה ' ; ar, حَيْفَا ') is the third-largest city in Israel—after Jerusalem and Tel Aviv—with a population of in . The city of Haifa forms part of the Haifa metropolitan area, the third-most populous metropol ...
in waters deep. The Tamar field is considered to have
proven reserves
Proven reserves (also called measured reserves, 1P, and reserves) is a measure of fossil fuel energy reserves, such as oil reserves, natural gas reserves, and coal reserves. It is defined as the " antity of energy sources estimated with reasonabl ...
of of natural gas, while the adjoining Tamar South field has . Together, they may have an additional 84 BCM of "probable" reserves and up to 49 BCM of "possible" reserves (reserves having a 10% probability of extraction).
[Haifa Gas Discovery Bumped to 5 Trillion Cubic Feet]
Oil In Israel, 10 February 2009 At the time of discovery, Tamar was the largest find of gas or oil in the Levant basin of the Eastern Mediterranean Sea and the largest discovery by
Noble Energy
Noble Energy, Inc. was a company engaged in hydrocarbon exploration headquartered in Houston, Texas. In October 2020, the company was acquired by Chevron Corporation.
The company was known as Noble Affiliates, Inc. until 2002.
As of December ...
. Since Tamar's discovery, large gas discoveries have been made in other analogous geological formations dating back to the
Oligocene
The Oligocene ( ) is a geologic epoch of the Paleogene Period and extends from about 33.9 million to 23 million years before the present ( to ). As with other older geologic periods, the rock beds that define the epoch are well identified but the ...
–
Miocene
The Miocene ( ) is the first geological epoch of the Neogene Period and extends from about (Ma). The Miocene was named by Scottish geologist Charles Lyell; the name comes from the Greek words (', "less") and (', "new") and means "less recen ...
epoch in the Levant basin. Because Tamar was the first such discovery, these gas containing
presalt formations have become collectively known as ''Tamar sands''.
History
![Levant Basin](https://upload.wikimedia.org/wikipedia/commons/8/82/Levant_Basin.png)
In 1999, Israel's Oil Commissioner granted
BG Group
BG Group plc was a British multinational oil and gas company headquartered in Reading, United Kingdom. On 8 April 2015, Royal Dutch Shell announced that it had reached an agreement to acquire BG Group for $70 billion, subject to regulatory and ...
preliminary exploratory permits to deep-sea blocks that included the Tamar
field. In December 2000, BG received an exploratory license, in a partnership that included three Israeli industrial companies, Mashav (15.6%, Dor Chemicals (7.2%), and Israel Petrochemical Enterprises (7.2%). In May, 2001, Mashav left the partnership and BG brought in STX,
Isramco
Isramco Negev 2 LP () is an American Israeli Limited Partnership that holds interests in oil and gas properties in Israel. The partnership shares are traded on the Tel Aviv Stock Exchange and have been a constituent of the TA-25 Index since Janua ...
, Clal Industries, and Granit-Sonol, the latter two leaving the partnership in 2004.
In December 2001, BG completed 3D seismic studies that indicated the potential of the Tamar field and of the adjoining Dalit field. BG recommended drilling an exploratory well at an estimated cost of $40 million.
In May 2002, the BG license was extended by the Oil Commissioner, on the condition that drilling begin no later than September 2003. In February 2003, the Commissioner extended the deadline to December 2004, and in December 2004 a further extension was given to June 2005. During this period, BG conducted negotiations for selling gas to the Israel Electric Company.
In April 2005, BG announced that it was abandoning its stake. According to some reports, BG quit after being unable to conclude an agreement to supply gas to the Israel Electric Company. (Israel in mid-2005 reached an agreement to receive gas from Egypt for US, a price that BG stated it was not willing to match.) In May 2005, the Oil Commissioner extended the license to December 2006 and allowed the remaining partners, STX,
Isramco
Isramco Negev 2 LP () is an American Israeli Limited Partnership that holds interests in oil and gas properties in Israel. The partnership shares are traded on the Tel Aviv Stock Exchange and have been a constituent of the TA-25 Index since Janua ...
, Dor Exploration, and Dor Chemicals to bring in the
Delek
Delek Group is an Israeli conglomerate and one of Israel's largest companies, Delek Group is involved in the energy and infrastructure, with investments in upstream and downstream energy, water desalination and power plants. Delek Group' subsid ...
-owned partnerships, Avner and
Delek Drilling
Delek Drilling LP () is an Israeli energy Oil & Gas partnership in the exploration, development, and production of Natural Gas and Oil. Delek group owned by Yitzhak Tshuva, is the controlling shareholder of the partnership. The partnership is tr ...
, on the condition that a contract for drilling be concluded by June 2006. (According to one source, Avner bought its stake from BG for one dollar).
Noble Energy joined as operator in 2006. In 2006, the license was extended to December 31, 2008, despite the failure to begin drilling, and despite the statutory seven-year limit on oil licenses set by Israel's Oil Law. Isramco reported in 2006 that exploratory drilling was expected to cost $69 million.
Drilling of Tamar 1 began in November 2008. At the time, seismic studies indicated that there was a 35% chance that the formation contained gas. The studies further indicated that if there was gas, the median estimate for the producible quantity was 107 BCM.
Tamar 1 was drilled to a depth of at a cost of $92 million. The partners announced the discovery on January 17, 2009.
[ On July 7, 2009, the partners announced a second successful appraisal drilling at Tamar 2, increasing the estimated reserves of the field by 26%. In mid-2011, four more appraisal wells were drilled, with additional gas found at Tamar 3. In September 2011, Noble began production development.
In September 2010, Noble announced that development of the Tamar field was beginning at an expected cost of $3 billion. In March 2012 the Tamar partners signed a 15-year, US$14 billion deal with the ]Israel Electric Corporation
Israel Electric Corporation ( he, חברת החשמל לישראל, abbreviation: IEC) is the largest supplier of electrical power in Israel and the Palestinian territories. The IEC builds, maintains, and operates power generation stations, sub- ...
to supply it with 42 billion cubic meters (BCM) of natural gas, with an option to increase the gas purchases up to $23 billion. By March 2012, the consortium developing Tamar had signed deals worth up to a total of $32 billion with six Israeli companies, committing up to 133BCM. According to a study commissioned by the government, the prices set were significantly higher than the price that would be demanded under comparable circumstances elsewhere. In 2012 Tamar was found to be the largest air polluting plant in Israel
Production
Production is carried out by eight wells connected by a long subsea double pipe tie-back to a gas processing platform located offshore Ashkelon. First commercial gas delivery took place on 1 April 2013 after three years of development work. Total initial delivery capacity was per day or 10billion
Billion is a word for a large number, and it has two distinct definitions:
*1,000,000,000, i.e. one thousand million, or (ten to the ninth power), as defined on the short scale. This is its only current meaning in English.
* 1,000,000,000,000, i.e ...
cubic metre
The cubic metre (in Commonwealth English and international spelling as used by the International Bureau of Weights and Measures) or cubic meter (in American English) is the unit of volume in the International System of Units (SI). Its symbol is m ...
annually. This was increased in 2015 to per day with the addition of compressors in the Ashdod reception terminal. In 2016, the reservoir produced 9.3billion cubic metre of gas, a 12% increase over the previous year.
In 2018, the output from the Tamar gas field yields more than 60% of Israel's electricity.
Pipeline connection controversy
On June 14, 2009, Shaul Tzemach, Director General of Israel's Energy and Water Resources Ministry
The Ministry of Energy ( he, משרד האנרגיה) is the Israeli government ministry responsible for energy and water infrastructure. The ministry has changed names several times since its establishment.
The ministerial post was established i ...
, announced that the Ministry would rely on an analysis by Noble Energy to determine how pipelines from Tamar would connect to the national gas infrastructure. On September 22, Noble presented its analysis for connecting Tamar at a site on the Israeli coast, either adjacent to Moshav Ma'ayan Tzvi or 5 km farther north at Moshav Dor. Public controversy arose over the location of a plant to clean and process the gas from Tamar. Communities in the Carmel region brought a petition to Israel's High Court in March 2010, demanding that alternative sites be considered. In July 2010, the High Court issued an injunction that the Ministry explain its decision. In August, Uzi Landau
Uzi Landau ( he, עוזי לנדאו, born 2 August 1943) is an Israeli politician and systems analyst. He served as a member of the Knesset for Likud between 1984 and 2006, and for Yisrael Beiteinu between 2009 and 2015. He also held several mi ...
, Minister of Energy and Water Resources, announced that the connection would be to Ashdod, a move that was expected to allow Noble to complete the project by the end of 2012, in line with the original deadline.
Energy crisis and economic consequences
The crisis in Egypt which began in 2011 led to sabotage of the pipeline
The Pipeline was one of the earliest American Internet service providers. It was founded in December 1993 in New York City by the science and technology writer James Gleick and computer programmer Uday Ivatury, who had met at the Manhattan Brid ...
in Sinai which supplied natural gas to Israel from Egypt. This, as well as declining production from the Israel Yam Tethys field, reduced the gas supplies to the Israel Electric Corporation and other large users, who turned to much more expensive liquid fuels until Tamar development was completed. The direct economic costs alone to the Israeli economy of the energy crisis have been estimated at NIS 20 billion.
Sheshinski Commission
Through 2009, Egypt increased the price of gas being sold to the Israel Electric Company, and the Israeli joint venture of Noble and Delek Energy, producing from the Yam Tethys field, followed suit. Higher prices enabled Yam Tethys profits for the third quarter of 2009 to reach new records, prompting several Knesset members to consider the need for revising the country's tax and royalty regime. On February 23, 2010, the Knesset Economics Committee held a session to discuss options for increasing taxes and royalties. During the session, committee member Carmel Shama stated that the government revenue from oil sales, as set in the Petroleum Law (1952), was relevant in an era when exploration risks were high and profits low, which was no longer the case in 2009. Gideon Tadmor, chairman of Delek Energy, claimed that changing the tax and royalty regime would freeze exploration and development.
On April 12, 2010, in response to the Knesset concerns, Israel's Treasury Minister Yuval Steinitz
Yuval Steinitz ( he, יוּבַל שְׁטַיְינִיץ; born 10 April 1958) is an Israeli politician who currently serves as a member of the Knesset for the Likud party. He also held several ministerial posts, including Minister of Finance, ...
established a committee to consider the country's fiscal policy regarding its gas and oil resources. Eytan Sheshinski was appointed to head the committee. By the time the committee presented its findings in January, 2011, the Leviathan gas field
The Leviathan gas field is a large natural gas field in the Mediterranean Sea off the coast of Israel, south-west of the Tamar gas field. The gas field is roughly west of Haifa in waters deep in the Levantine basin, a rich hydrocarbon area in ...
had also been discovered.
The main recommendations of the committee included: 1) eliminating the tax allowance for "depreciation" of a field's value as its gas and oil was produced; 2) leaving the royalty rate unchanged at 12.5%; and 3) imposing a windfall profits levy, which would reach 50% of a producer's profits once the producer had recouped a certain percentage of his exploration and development costs. The windfall profits levy was incorporated into the Petroleum Profit Taxation Law, 5771-2011, which passed in March 2011. The law set the "recoup" percentage at 280% for the Tamar field and 200% for the Leviathan field and any field that would be developed later. State income from the windfall profits levy will be set aside in a sovereign wealth fund
A sovereign wealth fund (SWF), sovereign investment fund, or social wealth fund is a state-owned investment fund that invests in real and financial assets such as stocks, bonds, real estate, precious metals, or in alternative investments such ...
called the Israeli Citizens' Fund.
The owners of the Tamar and Leviathan licenses lobbied against the law, claiming that it represented a breach of contract and would scare off future investors in Israel; Uzi Landau, Minister of Energy, argued against applying the law to the Tamar field in particular, saying it would delay the field's development. Nevertheless, when Tamar production began on schedule in April 2013, both Landau and Noble CEO Charlie Davidson claimed that the project had been completed in record time.
Monopoly Position of Tamar Partners
In January 2011, as the Knesset was debating the Profit Taxation Law, the Egyptian Revolution of 2011
The 2011 Egyptian revolution, also known as the 25 January revolution ( ar, ثورة ٢٥ يناير; ), began on 25 January 2011 and spread across Egypt. The date was set by various youth groups to coincide with the annual Egyptian "Police ho ...
began. Within weeks, the Egyptian-Israeli gas pipeline had been sabotaged, and in April the former Egyptian petroleum minister had been arrested for alleged corruption related to the sale of gas to Israel. The cessation of gas from Egypt meant that the Tamar project would come on-line as the sole gas supplier to Israel. By the end of 2011, the Tamar group had raised the price of gas in its contract with IEC, effectively restoring to the partners most or all of the profit that they had expected before the passage of the Profit Taxation Law.
In May 2011, Energy Minister Uzi Landau instructed the pricing commission of the ministry to evaluate regulating the price of gas. In May, 2012, the commission published its conclusion that gas should be a regulated commodity and that the commission would monitor contracts to determine whether prices were fair. A study sponsored by the commission showed that the Tamar partners annual after-tax returns could be expected to be 54% of assets, as opposed to the 19% annual return projected by the Sheshinski Committee. In February 2014, Knesset Member Shelly Yachimovich
Shelly Rachel Yachimovich ( he, שלי רחל יחימוביץ׳, born 28 March 1960) is an Israeli politician, who served three terms as the official Leader of the Opposition, a member of the Knesset, and a member of the Foreign Affairs and Defe ...
issued an open letter to the government, berating it for not setting fair gas prices that could reduce the country's cost of living.
Langotsky claims
An early promoter of the project was Israeli oil geologist Joseph Langotsky, who named the Tamar and Dalit fields after his daughter and granddaughter. Langotsky had a small share of STX, a limited partnership that had a small share of the Tamar license from 2001 through 2008. The primary owner of STX was Israeli businessman Benny Steinmetz
Benny or Bennie is a given name or a shortened version of the given name Benjamin (name), Benjamin or, less commonly, Benedict (given name), Benedict, Bennett (name), Bennett, Benito (name), Benito, Benson (given name), Benson, Bernice (disambigua ...
. Langotsky sued Steinmetz after the Tamar discovery in 2010, claiming that Steinmetz dropped out of the partnership two months before drilling began, causing Langotsky to lose his rights to the field. In July 2013 the court ruled in Langotsky's favor, ordering Steinmetz to pay Langotsky NIS 50 million (appx. US$14 million) in compensation.
Maritime border with Lebanon
Following the discovery in 2009, some Lebanese leaders, particularly officials of the Lebanese Shi'a Islamist group Hezbollah
Hezbollah (; ar, حزب الله ', , also transliterated Hizbullah or Hizballah, among others) is a Lebanese Shia Islamist political party and militant group, led by its Secretary-General Hassan Nasrallah since 1992. Hezbollah's parami ...
made statements threatening Israel against developing the sites, and Israeli officials made counter threats against Lebanese intervention. In August 2010, the issue was largely resolved when Lebanon submitted to the United Nations
The United Nations (UN) is an intergovernmental organization whose stated purposes are to maintain international peace and international security, security, develop friendly relations among nations, achieve international cooperation, and be ...
its official view regarding the maritime border
A maritime boundary is a conceptual division of the Earth's water surface areas using physiographic or geopolitical criteria. As such, it usually bounds areas of exclusive national rights over mineral and biological resources,VLIZ Maritime Bound ...
, indicating that it considered the Tamar and Leviathan gas fields to be outside Lebanese territory (though it indicated other prospective fields in the region may be within Lebanese territory). The US expressed support for the Lebanon proposal.
Export plans
Delek Energy held talks on exporting natural gas from Tamar to Cyprus
Cyprus ; tr, Kıbrıs (), officially the Republic of Cyprus,, , lit: Republic of Cyprus is an island country located south of the Anatolian Peninsula in the eastern Mediterranean Sea. Its continental position is disputed; while it is geo ...
and to South Korea
South Korea, officially the Republic of Korea (ROK), is a country in East Asia, constituting the southern part of the Korea, Korean Peninsula and sharing a Korean Demilitarized Zone, land border with North Korea. Its western border is formed ...
. Shipments to Asia would be by Liquified Natural Gas
Liquefied natural gas (LNG) is natural gas (predominantly methane, CH4, with some mixture of ethane, C2H6) that has been cooled down to liquid form for ease and safety of non-pressurized storage or transport. It takes up about 1/600th the volu ...
, for which a floating liquefied natural gas terminal would be built by Daewoo Shipbuilding & Marine Engineering
Daewoo Shipbuilding & Marine Engineering Co., Ltd ( ko, 대우조선해양; abbreviated DSME) is one of the "Big Three" shipbuilders of South Korea, along with Hyundai and Samsung.
History
On 21 February 2011, the A. P. Moller-Maersk Group (M ...
, with Front-end engineering
Front-End Engineering (FEE), or Front-End Engineering Design (FEED), is an engineering design approach used to control project expenses and thoroughly plan a project before a fix bid quote is submitted. It may also be referred to as Pre-project pl ...
of the terminal to be done by Höegh LNG.
In March, 2013, Israeli Minister of Energy, Uzi Landau
Uzi Landau ( he, עוזי לנדאו, born 2 August 1943) is an Israeli politician and systems analyst. He served as a member of the Knesset for Likud between 1984 and 2006, and for Yisrael Beiteinu between 2009 and 2015. He also held several mi ...
issued a notice to the Tamar partners not to proceed with signing export contracts until it is granted permission to do so by the Israeli government.[
]
See also
* Energy Triangle
*Economy of Israel
The economy of Israel is a developed free-market economy. The prosperity of Israel's advanced economy allows the country to have a sophisticated welfare state, a powerful modern military said to possess a nuclear-weapons capability, modern inf ...
* Sarah and Myra
*Leviathan gas field
The Leviathan gas field is a large natural gas field in the Mediterranean Sea off the coast of Israel, south-west of the Tamar gas field. The gas field is roughly west of Haifa in waters deep in the Levantine basin, a rich hydrocarbon area in ...
*List of natural gas fields
This list of natural gas fields includes major fields of the past and present.
N.B. Some of the items listed are basins or projects that comprise many fields (e.g. Sakhalin has three fields: Chayvo, Odoptu, and Arkutun-Dagi).
25 Largest conve ...
* Natural gas in Israel
Natural gas in Israel is a primary energy source in Israel, mainly utilized for electricity production and to lesser degree in industry. Israel began producing natural gas from its own offshore gas fields in 2004. Between 2005 and 2012, Israel ha ...
References
{{Resources in Israel
Natural gas fields in Israel
Natural gas field disputes