IsraelStrategist.com – The Resource on Israel's Economy, Companies & Markets


 
Hebrew French Spanish Portuguese

Haaretz: Israel’s gas reserves insufficient for exports

Published on Jul 18 2012 // Business and Financial News, Market

Jul.18, 2012 | 5:16 AM–Israel will need 50% more natural gas than has been forecast until now and its offshore reserves will be empty in less than 40 years, two of the government’s chief scientists said in a letter that the government chose not to publicize.

Three months ago, when the Tzemach Committee appointed to draft a natural gas policy published its interim reports, quite a few eyebrows were raised. This wasn’t because the committee backed the proposal to export half the natural gas in the offshore reserves; it had been considering this from the beginning.

What was surprising was a letter that followed the report’s publication, written by the Environmental Protection Ministry’s director general, Alona Sheffer-Caro, a member of the committee.

In the letter, she said she objected to the committee’s conclusions, and noted that she hadn’t been the only one.

The Environmental Protection Ministry’s stance had been publicized in advance, but Sheffer-Caro stated in her letter: “Remember the letter from the chief scientists from the Energy and Water Ministry and the Environmental Protection Ministry stated that there had been multiple errors in the Natural Gas Authority’s projections of natural gas demand, which is going to be significantly higher than even the authority’s maximum projection.”

In other words, the quantity of gas that the regulator stated Israel needs to keep for itself rather than export is way too low.

It turns out that this was not simply a letter, but rather an in-depth report that took months to prepare. It was submitted to the committee in March.

But it was never published on the committee’s website along with all the other opinions submitted – although it was immediately posted after TheMarker recently asked the Energy and Water Ministry for comment. In fact, aside from Sheffer-Caro’s letter, no mention was ever made of its existence.

This could be because its conclusions were even harsher than those voiced by other opponents of exporting gas, and its criticism of the gas authority is even more strident than that of the Environmental Protection Ministry.

However, TheMarker has obtained a copy.

“We believe Israel should increase its use of natural gas by 2020 and should not export gas,” wrote Sinai Netanyahu and Shlomo Wald, the chief scientists of the Energy and Water Resources Ministry. “The Natural Gas Authority’s estimates are lacking. There’s a gap of 100 to 150 billion cubic meters between the demand projections that were presented to the committee and the most recent projections. The gas reserves are likely to last even less than 40 years!” they wrote, exclamation mark and all.

Yet last week, Natural Gas Authority head Shuki Stern stated during a public hearing held by the Tzemach Committee that there had indeed been an error in his authority’s demand projections, and that it should have told the committee that Israel needs to keep 501 billion cubic meters for its own use, and not the 417 billion it had previously estimated – a difference of 20%…Read More>>

Leave a comment

You must be Logged in to post comment.