BMI View: The recent approval of Israel ' s highly-contentious natural gas framework is fostering activity in the country ' s upstream sector. Israel has already announced plans to auction up to 24 new offshore blocks by the end of 2016, while the country's flagship Leviathan gas project is seeing progress with its development plan being approved in June. In light of these developments, w e hold our view that a lasting regulatory stability and successful implementation of Israel's new gas framework will be crucial for the development of the country's prospective gas industry.
|e/f = BMI estimate/forecast. Source: BMI, EIA|
|Crude, NGPL & other liquids prod, 000b/d||0.5||1.5||1.5||1.5||1.5||1.7||2.4|
|Refined products production, 000b/d||291.0||292.7||290.5||286.5||277.9||273.7||274.3|
|Refined products consumption & ethanol, 000b/d||232.9||233.9||232.5||227.0||222.7||216.0||213.9|
|Dry natural gas production, bcm||7.5||8.0||8.6||9.0||11.7||13.9||19.8|
|Dry natural gas consumption, bcm||7.6||8.7||9.1||9.6||10.4||11.3||11.7|
Latest Updates and Key Forecasts
On 22 May 2016, Israel's government approved the revised offshore gas plan, aiming to partially break up the offshore gas monopoly of Noble and Delek and establish a greater regulatory stability in the upstream sector. Importantly, a compromise has been found on the highly contentious 'stability clause', which is expected to foster exploration and development of major gas projects.
Israel is looking to auction up to 24 new offshore blocks by the end of 2016. Despite the resource potential, we see only marginal interest from companies with sufficient offshore knowledge and experience.
In August 2016, a Cypriot energy company Energean agreed to buy Israel's Tanin and Karish offshore gas fields from Delek for USD148.5mn. Within the six months from this date, Energean is expected to submit development plans for the two fields.
In June 2016, US-based Noble Energy received an approval from the Israeli authorities for its development plan for the Leviathan field. The development costs of phase one are estimated at USD3.5-4.0bn and the first production is slated for 2019.
As a part of Tamar field expansion, Delek and Noble expect to spud Tamar 8 well in Q4 2016. Total net expenses are valued at USD228mn. In the meantime, Noble has agreed to divest 3% of its working interest in Tamar field to the Israel-based Harel Group for USD369mn.
Supported by production from Tamar, Israel is set to become a net exporter of gas in 2018. New output from Leviathan is expected to lift the country's export volumes to more than 13bcm in the early 2020's. A further upside potential comes from Leviathan's phase two development.
The normalisation of relations between Turkey and Israel marks an initial step to a more pragmatic approach to potential gas trade. However, we believe the same political and logistical issue with regards to Cyprus, Lebanon and Syria will remain a hindrance to progress.
The Israel Oil & Gas Report has been researched at source and features BMI Research's independent forecasts for Israel including major indicators for oil, gas and LNG, covering all major indicators including reserves, production, consumption, refining capacity, prices, export volumes and values. The report includes full analysis of industry trends and prospects, national and multinational companies and changes in the regulatory environment.
BMI's Israel Oil & Gas Report provides professionals, consultancies, government departments, regulatory bodies and researchers with independent forecasts and competitive intelligence on the Israeli oil and gas industry.
- Benchmark BMI's independent oil and gas industry forecasts for Israel to test consensus views - a key input for successful budgeting and strategic business planning in the Israeli oil and gas market.
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BMI Industry View
Summary of BMI’s key forecasts and industry analysis, covering oil and gas reserves, supply, demand and refining, plus analysis of landmark company developments and key changes in the regulatory environment.
Industry SWOT Analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the upstream and downstream sectors and within the broader political, economic and business environment.
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Historic data series and forecasts to end-2024 for all key industry indicators, supported by explicit assumptions, plus analysis of key downside risks to the main forecast:
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BMI’s Oil & Gas Risk Reward Index
BMI’s Risk Reward Indices provide investors (independents, NOCs, IOCs, oil services companies) looking for opportunities in the region with a clear country-comparative assessment of the upstream and downstream market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.
A profile of the upstream and downstream sectors, including analysis of reserves, output, consumption and trade of energy products; overview of the industry landscape and key players; assessment of the business operating environment and the latest regulatory developments.
Comparative company analyses by USD sales, % share of total sales, number of employees, year established, ownership structure, oil production (‘000b/d), gas production (bcm), downstream capacity (‘000b/d) and % market share.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate Company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
Regional perspective on size and value of the industry. Plus comparative rankings by production, refining, imports and exports of oil, gas and LNG.
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Based on our country coverage of over 99% of global oil and gas production and consumption, BMI provides demand, supply and price forecasts to end-2024 for oil, gas and oil products.
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*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.