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Israel, Canada ink energy research deal

By Tony Cadwalader | DED | July 6, 2012

In case you missed it, earlier this week Canada and Israel signed a new energy cooperation agreement, according to YnetNews. The deal was inked during Canadian Natural Resources Minister Joe Oliver’s visit to Israel last week, the site reported.

“The World Energy Council believes that the recent oil and gas deposits found in Israel’s coastal plains is one of the largest in the world. If estimates of the basin containing up to 250 billion barrels of shale oil prove accurate, Israel will become one of the world’s top-three countries in shale oil resources, behind just the United States and China, the report said.”

Russia has taken a keen interest in Israel lately, and with these discoveries it is likely Russia would offer its help. This would have larger geopolitical ramifications in the region as Turkey’s efforts to block gas production in the region could be rebuffed by Russia, a long time strategic partner. […]

“Gazprom and other Russian companies are also likely to do well in any gas exploration deals developed with the strongly pro-Moscow (and very cash hungry) Greek Cypriot government.

“The stakes are not small: the offshore Levantine Basin (which Syria, Lebanon, Turkey, Greece, Cyprus, Israel and even Gaza will all have some claim to) is believed to have 120 trillion cubic feet of natural gas and ‘considerable’ oil.  Drillers working in Israeli waters have already identified what look to be 5 billion barrels of recoverable oil in addition to over a trillion cubic feet of gas. (US firms were involved in these finds.) Israel’s undersea gas reserves are currently estimated at about 16 trillion cubic feet and new fields continue to be rapidly found.

“The new Israeli-Russian agreement is part of a conscious strategy by the Israeli government to use its nascent energy wealth to improve its embattled political position. With Italy reeling under the impact of big wrong-way bets on Iran, Rome may also begin to appreciate the value of good ties with a closer and more dependable [sic] neighbor. Another sensible target for Israeli energy diplomacy would be India: the two countries are already close in a number of ways, including trade and military technology, and India is eager to diversify its energy sources.

“Gas is one thing, but potential for huge shale oil reserves under Israel itself, however, is a new twist. According to the World Energy Council, a leading global energy forum with organizations and affiliates in some 93 countries, Israel may have the third largest shale oil reserves in the world: something like 250 billion barrels. (The US and China are both believed to have larger shale oil reserves, with the US believed to have the equivalent of well over 1 trillion barrels of potentially recoverable shale and China having perhaps one third of that amount. Canada’s Athabaskan oil sands reserves may contain the equivalent of 2 trillion of barrels conventional oil, or more than all the conventional oil known to exist in Saudi Arabia, Iraq and Iran combined.) If the estimates of Israeli shale oil are correct, Israel’s gas and shale reserves put its total energy reserves in the Saudi class, though Israel’s energy costs more to extract.”

July 6, 2012 - Posted by | Economics | , ,

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