HOUSTON—The Eastern Mediterranean area is known for gigantic natural gas discoveries such as Noble Energy’s Leviathan and Tamar offshore Israel, but there is potential for oil as well in the Levant Basin.
“There are various types of reservoir rocks. We see good conditions for maturation of oil. It’s particularly in the deeper layers,” Michael Gardosh, chief geologist for Israel’s energy ministry, told Hart Energy.
With efforts concentrated mostly nowadays on developing gas discoveries offshore Israel, no company has really pursued potential deep oil prospects yet. But that could change, as Gardosh said some companies—including Noble Energy Inc.—have shown interest.
“We look forward to someone actually chasing that,” Gardosh said.
Getting to the oil could prove challenging because of its depth—about 5 to 7 km. However, Gardosh said the depths, while deep, are being drilled elsewhere today.
Israel’s energy officials believe a deep oil system could extend across an area where it is offering blocks to prospective oil and gas developers. The country was among those spreading word about exploration, development and production opportunities available during the recently held NAPE Summit in downtown Houston.
The push for oil and gas investment comes amid improving market conditions and as deepwater exploration works to make a comeback with technological advances such as in 3-D digital seismic imaging at its side.
Israel is offering licenses for 19 blocks, which each span up to 400 sq km (154 sq miles), in five zones in the southern portion of Israel’s territory in the Eastern Mediterranean Sea. Comprising multiple blocks, each zone covers up to 1,600 sq km (618 sq miles), according to the ministry.
Some work has been carried out by previous operators and by Israel in the area, Gardosh said. “We also see potential targets that are quite attractive in our opinion.”
At more than 100 million years old, the Levant Basin’s origins date back to the early Mesozoic, the geologist explained, noting several tectonic events have occurred and created deep and shallow structures of various types.
The ministry said 3-D seismic data have shown structural and stratigraphic traps across the Levant Basin, where the yet-to-be-discovered potential in the Mesozoic and Tertiary reservoirs offshore Israel are estimated at 6.6 billion barrels of oil and 2,137 billion cubic meters of natural gas in place.“The main reservoir rock, which has proved to be the most successful so far, is what we call deep marine turbidite sands—sands which are in a deep marine environment,” Gardosh said. “These are the gas-bearing sands of some of our major fields like Leviathan and Tamar. They are all coming from the same unit we call the Tamar sands.”
Gardosh described the sands as being very prolific with a wide distribution, perhaps extending farther south into the bid area. The area is also believed to have carbonate reservoir rock, which he said is the “big game now in the Eastern Mediterranean region.” The Eni-operated Zohr Field offshore Egypt in the Levant Basin is a carbonic play of Miocene age with Cretaceous upside. Eni’s Calypso discovery offshore Cyprus is also a Cretaceous carbonate play.
So far, the licensing round—which closes in June—has attracted a variety of companies to the ministry’s data room in Jerusalem. But results, expected in July, will reveal whether the round is a success.
Israel’s 2017 auction drew bids from only two groups of companies—Energean Oil & Gas Plc and a consortium comprising ONGC Videsh Ltd., Bharat PetroResources Ltd., Indian Oil Corp. Ltd. and Oil India Ltd. At the time, the market was struggling to recover from the downturn and companies continued to hold back spending.
This time around, Israel has made changes in hopes of generating more interest. Among the changes: the bid area moved farther south, the blocks are larger and are grouped into zones that allow companies to chase several plays, and more flexibility is being allowed in the work program.
“We ask for a commitment of one well after three years within all these zoned areas, and then progressively add more wells as the license progresses,” Gardosh said before turning to the region as a whole. “There is a lot of activity; partnerships being formed; a lot of export options are being created. That puts this area in a better place than it was a few years back.”
Energy has brought together countries once considered enemies in the region.
Israel, which has enough gas to meet domestic demand until 2040, has signed export agreements with Jordan for gas from Tamar and with Egypt for gas from Leviathan.
“This is actually the first major economic cooperation that we’ve had with these countries,” Mira Marcus, communications director for the Israel’s energy and economic mission, said after mentioning the “cold peace” Israel has had with the countries.
Israel is also working to create a regional gas hub with its neighbors to potentially provide gas to European markets. The move comes as Israel aims to increase its gas and renewables mix, while reducing coal consumption.
In the last three years, Israel’s coal consumption has dropped from about 50% to 25%, said Shay Luvshis, Israel’s Houston-based energy and economic consul. He added that the government also decided to ban the import of gasoline and diesel vehicles after 2030, meaning vehicles must be powered by electricity or compressed natural gas.
Israel targets an energy mix of 85% gas and 15% renewables by 2030, respectively up from about 65%-70% and 5%-10% today.
The shift toward cleaner sources of energy is a move being taken by many countries across the world as oil demand remains.
Plans for the 2,100-km EastMed gas pipeline are also underway.
An agreement was signed by Israel, Cyprus, Greece and Italy to build a subsea pipeline that will connect Israel, Cyprus, Greece and Italy and then provide gas to Western Europe, Marcus said, pointing out how Eastern Mediterranean gas provides an alternative source to North Sea.
“We’ve talked about the amount of gas that is yet to be found. Companies that will come need to know what to do with all that gas,” she said. “What we’ve done is we’ve opened options compared to the previous bid round.”
The Eastern Mediterranean is an upcoming hotspot with support from surrounding countries, resources and export options, Gardosh added.
“This is the time to join the party. Go in and get some acreage. I think the market is there for that,” he said.
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