Where Is Israel's Natural Gas Sector Is Heading To?

Newswise — Israel’s Anti-Trust Authority, Chief Prof. David Gilo, announced on Monday his decision to prevent the investing companies in Israel’s natural gas sector to hold stakes in both of Israel’s major offshore natural gas fields, obligating them to sell their stakes in one of the fields - Tamar or Leviathan.

Prof. Brenda Shaffer, an expert on international oil and natural gas polices, that advised the Israeli Government’s Zemach Committee on its natural gas export policy, claims that Israel’s natural gas and electricity sectors suffer from the government’s extreme free market approach that is not applicable to a small place like Israel, where the are only two sources of natural gas supply and one meaningful buyer—the Israel Electric Corporation. “Israel is trying to apply a US model gas market on a market the size of 10 US Congressional districts.”

“While clearly Gilo’s decision will be taken to court by the investing companies and may be overturned, in the short term, this will delay the development of the Leviathan project. In addition, Israel will not find a lot of investing companies in line to acquire the stakes in one of the fields. Globally, expensive natural gas production projects are encountering commercial difficulties. No one is looking for an additional one", concludes Prof. Shaffer.