Roadshow_2016_Presentation GD Shaul Meridor_Regulatory and ...
Transcript of Roadshow_2016_Presentation GD Shaul Meridor_Regulatory and ...
Shaul MeridorDirector GeneralMinistry of Energy
IsraeliGasOpportunity
Main Indicators of Israel’s Economy
Population 8.5 million
GDP (current US $, (2015 $ 300 billion
GDP per capita (current US $, (2015 34,000$
Average GDP Annual Growth 2006-2015) ) 3.8%
Unemployment (2015, August) 5.3%
No.1 worldwide in technology startups per capita
Member of the OECD since 2010
Sovereign credit rating – A+ / A1
Status of Exploration & Production in Israel
Oil Field
Gas Field
Pipelines
Legend:
Production Platform-100
-
2000
Aphrodite/Ishai
Leviathan
Karish
Tanin
Dalit
Tamar
Tamar SW
Shimshon
Noa
MariB
10 gas fields were discovered in
the Israeli EEZ over the past 15
years, including the giants Tamar
and Leviathan.
Recoverable gas reserves and
resources are estimated at more
than 30 TCF of gas and 50 MMBL
of condensate
3 gas fields were developed
Development plan for the
Leviathan field is underway and
first-gas is expected in 2019
Israeli Regulation – Oil & Gas
Ministry of National
Infrastructure, Energy
and Water Resources
Ministry
of Finance
Ministry of
Environmental Protection
Petroleum
CommissionerNational Gas
Authority
Downstream
• Safety & engineering
Upstream
• G&G and Environment
• Safety & engineering
• Royalties- 12.5%
• Oil and gas profits levy
• The formula is of the R factor type:
• The levy will apply only after return of 150% on investment.
• The levy is progressive - the rate increases with the increase in profits
Israel fiscal system- Oil & Gas
R-Factor
Levy Rate
50%
20%
1.5 2.30%
Israel fiscal system- Oil & Gas
Cash Flow Exploration and
development expenses
Expenses during the
project
Royalties
Oil and gas
profits levy
Corporate tax Revenues
4,000
2,000
1,000
0
1,000-
2,000-
3,000-
4,000-
Large gas field- High level of profitability
Years
–רווח לפני מס 9.1 ח"מיליארד שח"מיליארד ש5.2-רווח לאחר מס
2,000
1,000
0
1,000-
2,000-
3,000-
4,000-
Years
Cash Flow Exploration and
development expenses
Expenses during the
project
Royalties
Oil and gas
profits levy
Corporate tax Revenues
Small gas field- Low level of profitability
Government Natural Gas Policy - Exports
• Securing supply of 540 BCM for domestic market
• Quotas per reservoir (50%-100%)
• Signed agreements in place, more in progress
Government Natural Gas Policy - Framework
• Resolves Anti-Trust and competition Issues
• Provides conditions for timely development
• Establishes an environment set to incentivize investment
• OECD as benchmark for new regulation
Incentives For Marginal Fields
• Today: each reservoir must be connected to shore
separately.
• Challenges:
High cost
Statutory Approvals
Coordination
• Incentive for marginal fields:
Government pipeline from platforms to shore
(continental shelf)
Export Options
1.Egypt
2.Jorden
3.Turkey
4.Palestinian Authority
5.Europe
Export Agreements
•Signed export agreements:
Jordan -( aeS daeD eht ta seitilicaf lairtsudnI1.9 BCM from Tamar)
Egypt– Dolphinus Holdings Ltd. (5 BCM from Tamar)
•Agreements being discussed:
Jordan – LOI with National Electric Power Co. (45 BCM, Leviathan)
Egypt - LOI with BG (LNG facility, 106 BCM, Leviathan)
Egypt - LOI with Union Fenosa Gas (LNG facility, 70 BCM, Tamar)
Demand for Natural Gas by Sector (2014-2040)
• Coal restrictions
• Support of NG transmission
• Subsidies for industrial customers
• Long term planning
IHS, 2016
Thank you