Natural gas offshore drilling rig
Photo: Reuters
Noble suspends Israel investments after regulator's decision
Energy firm developing two largest offshore natural gas fields in Israel to halt further injections until Jerusalem finalizes status of deal.
Noble Energy announced on Thursday it would not further invest in its offshore natural gas operations in Israel until Jerusalem settles a regulatory dispute regarding the Leviathan and Tamar fields in the eastern Mediterranean.
During its quarterly earnings call, Noble said "Further investments in the expansion of Tamar, as well as the initial development of Leviathan, have been suspended until regulatory issues are resolved." However, the firm's representative said that firm was still intent on completing an onshore compression project in Ashdod in the first half of 2015.
Tamar gas rig (Photo: Abatross Aerial Photography)
Noble officials also stressed that they were committed to finding a solution that would be agreeable to all parties to allow for the development of Israeli natural gas reserves.
Monopoly regulation
Earlier in the day, Israel decided to restructure the private ownership of Tamar and Leviathan, its two biggest natural gas fields, a move which will see new regulations put in place to break what Israel's anti-trust authority deemed a monopoly.An inter-ministerial committee with representatives from the Israel Antitrust Authority, Finance Ministry, head of the National Council for Economics, Economics (Infrastructure) Ministry, Energy and Water Ministry and the Attorney General's office published an outline for the restructuring which it presented to Yitzhak Tshuva's Delek and Noble Energy Thursday.
Drill workers near Tamar offshore rig (Photo: Noble Energy)
Noble and Delek are the largest stakeholders in Israel's two main gas fields - Tamar, which began production in 2013, and Leviathan, the world's largest offshore gas discovery of the past decade, which they hoped to bring online in 2018.
According to the outline, the State will regulate prices on natural gas sales until the ownership restructuring is complete, followed by a cap on sales prices for the next five years.
The government is working to create an ownership structure in which the remaining gas in the Tamar field will be opened up to a new company and the two's additional partner – Isramco.
Thus, the state hopes to create competition between the two large fields, by preventing those running the fields to influence the sales and practices of the other fields, de facto decentralizing the new and lucrative market.
Avital Lahav contributed to this report.
