Minister of Energy and Infrastructure, Eli Cohen: “SOCAR and bp’s entry is excellent news for the State of Israel. Natural gas is a strategic asset, strengthening our economic and political standing in the world in general and in the Middle East in particular. Thus, especially in these times, we are working to expand the production of natural gas for the benefit of both domestic and export markets”.
Minister of Energy and Infrastructure, Eli Cohen, and Director of the Natural Resources Administration, Chen Bar Yoseph, granted 6 licenses today within the framework of the Israel 4th Offshore Bid Round for natural gas exploration. The licenses were granted in accordance with the minister’s policy to explore for additional natural gas reserves, in order to ensure domestic supply and increase exports. Further licenses are expected to be granted in the future, and a fifth bid round is expected to be launched this year as well.
The licenses were granted in the area known as Zone I to the winning consortium, consisting of SOCAR, Azerbaijan’s national oil and gas company, British company bp and Israeli company NewMed Energy, with each company holding approximately one third of the rights to each license. SOCAR, which will serve as the operator for the licenses, is an established company with extensive experience in developing natural gas fields, while bp is one of the world’s leading integrated energy companies. For both companies, this will be their first entry into activity in the natural gas field in Israel. The awarding ceremony took place with the Azerbaijani Minister of the Economy and Chairman of the SOCAR Supervisory Board, Mikayil Jabbarov, and SOCAR CEO Rovshan Najaf in attendance.
Zone I, approximately 1,700 square km in area, is located in the northern part of Israel’s economic waters and was put up for offer as part of the 4th bid round in 2022. Activity in this area – which has almost never been explored before from a natural resource perspective – is expected to focus in the first stage on conducting seismic and other surveys, while the results of these surveys will inform the decision on whether to drill exploration wells.
The 4th bid round was launched in December 2022, and bids were submitted July 2023. In late October 2023, the winning companies in two of the four designated zones were announced. The remaining bid round results are expected to be published in the future.
Director of the Natural Resources Administration, Chen Bar-Yoseph: “We are happy to grant today the first licenses following the fourth competitive process, which constitutes a breakthrough in the field of natural gas exploration in Israel. These licenses, along with others to be granted later on, express an investment commitment by the companies which will be at the range of tens of millions of dollars in the initial stage and may reach even higher at later stages. The ability to guarantee the needs of the local market while maintaining energy security and an attractive environment for investment is a top priority for all those involved in natural gas policy, and we are certain that this policy will bear fruit for the benefit of the energy market and the citizens of Israel.”
