Israeli Companies See Potential for Major Offshore Gas Fieldby
Daniel licenses could hold as much as 9TCF of natural gas
Modiin shares surge almost 400 percent on consultant's report
Israeli oil and gas explorers Isramco Negev 2 LP and Modiin - LP said a consultant’s report on the Daniel licenses offshore Israel revealed potential for 8.9 trillion cubic feet of gas. Shares of both companies rose.
The size of the undersea reserves, according to the report by Netherland, Sewell & Associates Inc., would make them the most significant Israeli discovery since the massive Leviathan field, the country’s largest, Modiin said in an e-mailed statement.
“Gas reserves of this size could significantly transform the Israeli energy market,” Modiin shareholder Yitzhak Sultan said in the statement.
Natural gas discoveries off Israel’s coast include the 10 TCF Tamar field and Leviathan, almost twice the size, which brought the nation closer to energy independence and to becoming an energy exporter. If gas is found at the Daniel licenses, it would help Israel become a regional energy hub and generate billions of dollars in revenues for the state, said Noam Pincu, an analyst at Psagot Investment House Ltd. in Tel Aviv.
“We need to be cautious because until there is an exploration drill we cannot be sure gas will be found,” Pincu said by phone. “If gas will indeed be discovered, that would be almost as huge as Tamar and it would increase Israel’s reserves, its energy independence and increase the competition in the market.”
Modiin, which holds a 15 percent stake in Daniel licenses, jumped 399 percent, the most since June 1999, to 10 shekels, bringing its market value to 29.6 million shekels ($7.5 million). Isramco, which holds a 75 percent stake in the licenses, rose as much as 13 percent, before trimming its gain to 1.1 percent. The TA-Oil & Gas index fell 0.6 percent.