Cablegate: Oil in Israel? Drilling Yields Positive

VZCZCXRO2967
RR RUEHROV
DE RUEHTV #0226 0321258
ZNR UUUUU ZZH
R 011258Z FEB 10
FM AMEMBASSY TEL AVIV
TO RUEHC/SECSTATE WASHDC 5260
INFO RUEHXK/ARAB ISRAELI COLLECTIVE
RHMFISS/DEPT OF ENERGY WASHINGTON DC

UNCLAS TEL AVIV 000226

SIPDIS

DEPT FOR NEA/IPA AND EEB/ESC/IEC/ENR

E.O. 12958: N/A
TAGS: ECON ENRG IS
SUBJECT: OIL IN ISRAEL? DRILLING YIELDS POSITIVE
INDICATIONS

(U) 1. Israelis may no longer be able to consider their
country "the one place in the Middle East without any oil,"
if positive indications announced last week yield commercial
quantities of oil. The area around the Dead Sea has long
been a target for exploration, and on January 24, a
consortium of Zerah Oil and Gas Exploration (50%) and Delek
Group subsidiaries Avner Oil and Gas (25%) and Delek Drilling
(25%) announced indications of oil in drilling at its Tzuk
Tamrur 4 site. Cautious, the consortium said that it is
premature to estimate the size of the reservoir, noting that
they will make the determination whether to pursue production
tests once logs are analyzed. However, pre-drilling seismic
studies indicated that the site contains a closed structure
with the potential to contain 6.6 million barrels of
high-quality oil.

(U) 2. Also last week, Givot Olam Oil, Ltd. stock prices
rose 15.1 percent when it notified the Tel Aviv Stock
Exchange (TASE)--just one month after announcing the
discovery of over 60 percent gas in drill mud at Meged 5 and
estimated reserves of 2000 million barrels of oil (10-20
percent recoverable)--that it will conduct production tests
at four segments of the Meged lease (I/11), located 20 km
north-east of Tel Aviv near Rosh Ha'Ayin in central Israel.
Initial examination of the logs shows an oil structure over
600 meters long, of which 50-100 meters have the potential
for production, according to the report. However, production
tests are necessary to determine whether the site will be
commercially viable.

(U) 3. COMMENT: Caution is prudent in this speculative
industry. Nonetheless, commercial quantities of oil in
addition to the offshore natural gas reserves discovered last
year would go far toward Israeli energy independence. It
remains to be seen whether these petro-discoveries dampen the
GOI's enthusiasm for alternative energy development.

Cunningham

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