The 1st Israeli offshore licensing round closed. Companies from India and Greece Bidded on Gas and Oil Exploration Blocks Offshore Israel. The 2nd licensing round will be launched in 2018
The 1st Israeli offshore licensing round:
Companies from India and Greece submitted Bids on Gas and Oil Exploration Blocks Offshore Israel
The 2nd licensing round will be launched in 2018
Today marked the end of the first ever competitive process in Israel for awarding oil and gas exploration licenses in its exclusive economic zone. The Ministry of Energy received bids from several international companies: Energean from Greece and a consortium of Indian companies that includes ONGC Videsh Limited, Bharat PetroResources Limited, Indian Oil Corporation Limited and Oil India Limited.
The Minister of Energy, Dr. Yuval Steinitz: "this bid round is the first step in a long-term process that would lead to full exploitation of gas and oil resources in the Israeli EEZ for the benefit of the Israeli citizens. We are planning to launch a 2nd licensing round in 2018, where lessons learned from the 1st bid round will be incorporated, and thus continue the effort to develop these strategic assets in the Israel's exclusive economic zone."
Ministry of Energy's officials noted that this is the first round of its kind, following more than 4 years when the Israeli sea was closed for new applications. The current licensing round included marketing events and worldwide road shows in order to attract international oil companies and investors. The 1st bid round included 24 licensing blocks each of a maximum size of 400 km2.
In the course of the coming weeks all bid proposals will be examined and professional and financial requirements as well as the proposed work programs will be reviewed prior to submitting the winning bids for the approval of the Petroleum Council. In the framework of the first offshore bid round bidders were requested to prove financial capability of minimum USD 400M in total assets and USD 100M in equity. Also, the operator is required to prove professional experience and capabilities in offshore exploration and production, all in order to ensure that the winning companies will develop the awarded licenses diligently and according to best international practice.
According to the licensing round principles, a license is given for a period of three years, at the end of which, the license can be extended by three additional years as long as the license holders have implemented the work plan and commit to carry out drilling during the extension period. To ensure the implementation of the work program, the license holders will deposit a guarantee in the value of USD 2.5M to USD 10M, pending on the work program commitments.
The competitive process for awarding gas and oil exploration licenses forms an important part of the Ministry's energy policy, and complement the development of the Leviathan Karish and Tanin gas fields.