Leviathan Developers Mull Scaledown

YERUSHALAYIM -

The developers of Israel’s offshore Leviathan gas field are contemplating a more limited production schedule than had originally been planned due to uncertainty over the prospects of exports to Egypt, Globes said on Monday.

Egypt recently decided to suspend talks on importing Israeli gas following the arbitration ruling that Egyptian national gas companies must pay IEC $1.76 billion compensation.

That, along with a sharp fall in oil prices, the acquisition of BG by Shell, and the announcement of Egypt’s Zohr field as a monumental gas discovery, have together cast serious doubt on the future of natural gas sales.

Consequently, the Leviathan partners are drawing up a contingency plan in case the Egyptian market disappears, according to industry sources.

For example, plans for construction of a floating production, storage and offloading vessel (FPSO) with a 16 billion cubic meters (BCM) annual natural gas capacity could be scaled down by as much as half.

The Ministry of National Infrastructures, Energy and Water Resources confirmed that it is currently discussing such modifications in the plans for Leviathan.