Natural gas fields give Israel a regional political boost
A decade after discovering natural gas fields off its Mediterranean coast, Israel is starting to feel the geopolitical boost. Its newfound riches have fostered economic bonds with its neighbors, tightening relations with Arab allies, and built new bridges in a historically hostile region – even without significant progress being made toward peace with the Palestinians. Last week’s inclusion of Israel into the Eastern Mediterranean Gas Forum in Cairo – a consortium aiming to cut infrastructure costs and lower prices – marked the first time Arab countries accepted Israel into such a regional alliance, sparking excitement in the country that its long-held hope of finally also making “economic peace” with Egypt and Jordan was fast approaching. “I think this is the most significant economic cooperation between Egypt and Israel since the signing of the peace treaty 40 years ago,” Israeli Energy Minister Yuval Steinitz told The Associated Press during his visit. “The discovery of significant gas fields in the eastern Mediterranean has also political value because it brings all of us … together to cooperate with each other.” The forum, which also includes Cyprus, Greece, Italy and the Palestinian Authority, aims to emerge as a mini-OPEC of sorts and highlights how Israel has been leveraging its newfound gas reserves into a powerful tool to expand its immersion into a region that has increasingly come to see Iran and Turkey, rather than Israel, as their greatest rivals. With the expected gas boon, Israel plans to wean itself off coal and emerge as an unlikely energy exporter – providing both an economic and political lift. In the coming months, Israel will begin exporting gas to Egypt as part of a $15 billion deal signed last year to provide 64 billion cubic meters of gas over a 10-year period that will help turn Egypt into a regional energy hub. The first batches will come from the operational Tamar field and later from the far larger Leviathan field, set to go online later this year. Israel already delivers gas to the Palestinians and to Jordan, with whom Israel’s Delek Drilling and its U.S. partner, Noble Energy, signed their first export agreement in 2016 – a $10 billion, 15-year deal to provide 45 billion cubic meters of gas. “This gives Israel an additional element to its relations with its neighboring countries. When you add an economic facet to the security cooperation it strengthens the bond and gives it stability,” said Oded Eran, a former Israeli ambassador to Jordan and to the European Union, and a senior researcher at Tel Aviv’s Institute of National Security Studies. Still, he said economic interests alone aren’t enough to fully integrate Israel into the Middle East. Arab nations without formal peace accords with Israel would need to see at least some progress on the Palestinian front before normalizing relations, he said. Israel has peace agreements with only two Arab countries – Egypt and Jordan. But warming ties with Israel remain unpopular on much of the Arab street, and the gas exports have sparked sporadic protests in Jordan. The Palestinians, pleased at being invited into the consortium, hope to develop their own gas fields off the coast of Gaza but for now are required by international agreements to acquire their fuel from Israel. Sameer Abdallah, a former Palestinian economy minister, said they import from Israel “because we have no alternative but once we can change that, of course we will.” The gas appears to have helped Israel grow closer to Arab governments and other Mediterranean countries that share its concern over what they perceive as the rising power of Iran and Turkey in the region. Just as Noble Energy was discovering the massive gas fields in Israeli and Cypriot waters, Cyprus in 2010 suddenly banned Turkish flotillas seeking to break the Israeli naval blockade of Gaza from using its shores – a stunning about-face after months of turning a blind eye to ships that were creating a diplomatic nightmare for Israel. Cypriot officials said at the time that Gaza-bound vessels were prohibited from leaving because of “vital national interests.” Relations have since soared. Israel now holds annual trilateral summits with Greece and Cyprus, which have become its geographical conduits to the West. The two also conduct joint military operations with Israel, and just a short flight away, have replaced Turkey as the Israelis’ preferred holiday destinations. The countries recently said they would sign an agreement for a $7 billion project to build a pipeline to carry natural gas from the eastern Mediterranean to Europe. Cyprus Foreign Minister Nikos Christodoulides has said he believes “hydrocarbons in the Eastern Mediterranean can become what the coal and steel was for the European community” – a reference to how in the 1950s, coal and steel brought European countries together economically and politically. Eran, the former Israeli diplomat, cautioned against investing so heavily in what he called “an economic adventure.” Even with the recent discoveries, he said the joint reserves were still not enough to create a strong enough economic lever to challenge global energy providers. Still, the upside of finally having natural resources of its own has been so appealing that the Israeli government has pushed forward even against stiff domestic opposition from environmental and social welfare activists. Critics, including prominent opposition lawmakers, say a controversial 2016 agreement over royalties is skewed in favor of the energy tycoons. More recently, local activists have been urging Noble Energy to move its proposed shoreline gas rig farther out to sea for fear of what they call catastrophic consequences of spreading toxic water and air pollution toward their homes. Noble and the Israeli government say it’s an irresponsible scare campaign and have countered with an aggressive ad campaign extolling the virtues of Leviathan, which it has dubbed “the national project.”
Gazprom Neft considering LNG production in Russia’s Arctic
Gazprom Neft, the oil arm of Russian gas giant Gazprom, is studying the possibility of its own liquefied natural gas (LNG) production in the Arctic as it tries to monetise its vast natural gas reserves. The discussions follow the successful launch of the Arctic-based Yamal LNG plant, controlled by Novatek, in December 2017. Russia wants to boost its global LNG market share in the next decade to around a fifth, from about 5 percent now. Russia has only two large LNG plants in operation – Yamal LNG with capacity of 16.5 million tonnes per year and Sakhalin Energy, at more than 10 million tonnes, on the eastern island of Sakhalin. Gazprom Neft announced a tender late last year for a study on how best to use its gas reserves in the Yamal region.Gazprom Neft, the oil arm of Russian gas giant Gazprom, is studying the possibility of its own liquefied natural gas (LNG) production in the Arctic as it tries to monetise its vast natural gas reserves. The discussions follow the successful launch of the Arctic-based Yamal LNG plant, controlled by Novatek, in December 2017. Russia wants to boost its global LNG market share in the next decade to around a fifth, from about 5 percent now. Russia has only two large LNG plants in operation – Yamal LNG with capacity of 16.5 million tonnes per year and Sakhalin Energy, at more than 10 million tonnes, on the eastern island of Sakhalin. Gazprom Neft announced a tender late last year for a study on how best to use its gas reserves in the Yamal region. The tender was first revealed by Interfax news agency on Tuesday. The company is seeking an analysis of oil and gas markets and ways to process its gas including in LNG form. The project is in its initial stages, a Gazprom Neft spokesman said. The company is also considering whether to build a gas pipeline on the Arctic seabed that would connect its Novoport field to the existing Gazprom network.
BMC invites private firms to set up biogas plant in city
If everything goes as planned, a bio-gas plant will come up in the city. The Bhubaneswar Municipal Corporation (BMC) has floated an expression of interest inviting private parties to set up the plant. After the private parties discuss with the BMC officials on the modalities and technicalities of bio-gas plant, the BMC will float request for proposal (RFP) and form a tender committee to select one of the parties to take up the work. BMC sources said it would provide the waste for the plant based on its capacity. “We are yet to know the technical details. Floating expression of interest will help us know how to go about it. The parties, which have been dealing with such works, will help us prepare the RFP too,” said an officer of BMC. Mostly, the plant would require organic waste. The BMC generates about 600 metric ton of waste a day. “The waste will be segregated so that the organic ones such as vegetable, remnants of food, cow dung and animal waste, can be used in the plant. It will be discussed at the RFP meeting as to how much waste the BMC will supply, in lieu of which the quantity of gas will be supplied by the private party,” the officer added. The BMC has decided that four acre will be given to the company to set up the plant. The bio-gas will include both CNG and cooking gas. “The BMC will decide whether to go for more production of CNG or cooking gas. The technical committee will take a final call on the matter,” said another officer. Earlier, the BMC had proposed a waste-to-energy plant at Bhusuni. But it doesn’t seem to be happening anytime soon due to steep opposition from the villagers. The bio-gas plant is likely to be an answer to reducing the heap of garbage collected at the designated site close to Bhuasuni in Daruthenga village.
Indian East Coast’s first LNG terminal readies for imminent commissioning: IOC
Indian Oil Corp is set to commission its maiden LNG terminal at Ennore in Tamil Nadu within days, company officials said Tuesday. Ennore terminal is the first LNG terminal to be built on India’s east coast, and is part of the IOC’s strategy to end decades of gas shortage in the region. The $725-million project is due to receive its commissioning cargo shortly after dredging work is completed by the end of January. The Ennore terminal will be connected to the nearby refinery operated by Chennai Petroleum Corporation, an IOC subsidiary, as well as downstream consumers such as Madras Fertilizers, Tamil Nadu Petro Products and Manali Petrol Products of South India. However, the gas distribution project — a 1,385-km (850-mile) gas pipeline linking the Ennore terminal with Nagapattinam via Puducherry — has yet to be completed. The first phase, connecting nearby urban areas, will be completed by May, officials said. The second phase will be completed by December and will be connecting the terminal with other cities in South India such as Madurai, Tuticorin and Bengaluru. The company’s Dhamra LNG terminal, also on the east coast, is expected to become operational in the second half of 2021. Construction commenced in July 2017.