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This One Number Just Changed The Outlook For Global NatGas

This One Number Just Changed The Outlook For Global NatGas

The eastern Mediterranean is very quietly becoming one of the most important spots globally for natural gas. With recent mega-finds in places like Egypt and Israel holding the potential to change the supply picture for the region, and beyond.

But news this week suggests there may be some hiccups coming for development in this critical area.

That came from Israel. Where Platts broke the story that the much-touted Leviathan offshore natgas discovery may not be as big as originally believed.

Industry sources told the news service that Israel’s government has just received a new report assessing reserves at Leviathan. And the numbers don’t add up with previous appraisals here. Related: Oil Crash Creates Glut Of Petroleum Engineers – More Layoffs Coming

Anonymous sources said the new reserves evaluation for Leviathan, prepared by SGS, came in at 16.6 trillion cubic feet — down a stunning 24 percent from previous assessments on the field, which had assessed Leviathan’s reserves at 21.9 Tcf.

There’s still a lot of uncertainty swirling around this issue. With Leviathan’s owners — Noble Energy, Delek Group and Ratio Oil Exploration — releasing a statement saying there has been no change in their assessment of Leviathan’s reserves.

But the dissenting reserves report was apparently prepared not for the operators, but was independently commissioned by Israel’s Energy and Water Resources Ministry. For its part, the ministry would only say that it has received an assessment — without disclosing any of the details. Related: Saudi Arabia Releases Ambitious Plan To Diversify Economy

Israeli government officials are now reportedly conducting a second assessment with another international consulting firm. Presumably to verify the unsettling drop in Leviathan’s reserves.

If the reduced reserves figures do stand up, it could be a gamechanger for the region. With sources telling Platts that the revision would reduce the amount of gas Israel could export to Europe, Turkey and Egypt.

Places like Egypt badly need this supply. And a reduction in potential exports could send other countries scrambling for new supplies — perhaps sending ripples through the global market.

Watch for confirmation from the Israeli government on just how much gas its new mega-field really holds.

Here’s to the real numbers

By Dave Forest

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