The Tamar Reservoir
The First Significant Discovery in the Region
At the end of March 2013, natural gas started to flow from the Tamar Reservoir and as it did, Israel took a huge step toward energy independence. Only four years after the discovery of the Tamar gas field in January 2009, its development was rapidly completed in order to meet Israel’s immediate need for natural gas in view of the cessation of the supply from Egypt.
Following the discovery of the natural gas reserves, the Israeli government decided to reduce the generation of electricity from the high polluting coal and oil distillates and to promote the use of power generation from more efficient and environmentally cleaner natural gas. The Tamar Field is located some 90 km west of Haifa, at an overall depth of about 5,000 meters below sea level, and in waters that
are about 1,700 meters deep. The field covers an area of 100 square kilometers, with the thickness of the reservoir layers reaching up to 300 meters.
The natural gas in Tamar is extracted through six production wells, built in such a way as to enable the production of 1.1 billion cubic feet (BCF) of natural gas per day.
In January 2017, the Tamar Reservoir began supplying natural gas to the Arab Potash Company and the Jordan Bromine Company on the Jordanian side of the Dead Sea. This is the first natural gas export agreement approved by the Israeli government, and within its framework, the Tamar Partnership expects to deliver millions of dollars’ worth of natural gas to the two plants in Jordan for a period of 15 years.
A World-Class Reservoir
The Tamar development system has been built in a way that produces redundancy and backup in the system, and stable production and flows over years.
According to the independent reserves evaluation conducted by NSAI, the estimated reserves of natural gas in the reservoir are around 11.14 trillion cubic feet (TCF) - around 315 BCM.
The Tamar development system was built so as to ensure redundancy in terms of the gas quality, since Tamar is positioned high on the global rating, as it is a reserve of dry gas (some 99% methane) with high porosity and permeability as well as high connectivity between the sections of the reservoir. Furthermore, the development of the reservoir was executed in a manner that provides the Israeli market with a continuous supply with minimal malfunctions, and indeed, the reservoir operates with an availability of some 99.98%, at the highest level by all standards.
Initial Development Budget
3.1 Billion $ (100%)
~ 11.14 TCF (315 BCM) gas and ~ 14.5mmbbl condensate
6 subsea wells, each with a production capacity of ~ 250 MMscfpd; total of ~ 1.1 BCF per day
Total Project Cost in 31/12/2019
4.5 Billion $ (100%)
World Class Asset
Less than 4.5 years from discovery to first gas. Strong operational track record (99.9% up time) and low running costs.
Source: Noble Energy
The supply of gas from Tamar is increasing constantly due to growing demand in the local economy and export markets. Demand for gas in Israel is expected to increase gradually and already in 2021 to reach 15 BCM/y
(an increase of more than 50% compared to 2016).
A majority of the Tamar gas supply contracts are long-term contracts, supplying a fixed cash flow over time.
Operating Costs and Expected Investments
Production costs are low relative to the volume produced, and the main operating costs are fixed, such that the cost per unit decreases with the increase in gas production.
Until now, over 4.5 billion US dollars have been invested in the project.
In the coming years, a decrease in capital expenses
is expected as a result of the completion of the development program, the compressor project, the drilling of the Tamar-8 well and the costs of the Yam Tethys facility usage agreement.
In addition to the decrease in expenses, no significant capital investments are expected on the project level until 2022.