Isranomics

Israel’s record gas production boosts state coffers

by | Aug 24, 2022 | Economy | 0 comments

When Leviathan, one of the largest offshore natural gas fields, was first discovered in 2010, the goal was that it would bring in a sizable amount of money for the state and contribute to the nation being somewhat energy independent. According to a report published by the Ministry of Energy, the hope has certainly been justified as royalties from natural gas, minerals and deposits increased by almost 50% in the first half of 2022 and totalled about NIS 829 million. Natural gas and mineral royalties fees brought in NIS 1.27 billion last year, up 15.3% from the same sources in 2020. 

This surge results from the first half of this year’s record-breaking natural gas production from the Leviathan and Tamar reservoirs. Since the collection process started in 2013, the Ministry of Energy has so far received around NIS 10 billion from the gas partnerships from the natural gas royalties.

Image: Pixabay

The Minister of Energy, Karine Elharrar said the following: “Once again, the Royalties Report demonstrates the importance of natural gas to the Israeli market, also in economic terms. Revenues keep increasing, as is the profit to the Israeli public. About one third of the revenues come from export, enabling a new and strong relationship with our neighbouring countries, and in the coming year we will increase the quantity of natural gas to be exported to Egypt, while reserving the quantity needed for the domestic market.

The first half of the year saw record natural gas output from the “Leviathan” and “Tamar” reserves, totalling 10.85 BCM, of which 6.26 BCM went to the local economy and 4.59 BCM went to export. This is a 21.9% increase over the production of 8.9 BCM in the first half of 2021. In addition, the rise in the value of the dollar also helped to significantly raise the total amount of royalties.

The production of natural gas from the Leviathan and Tamar reservoirs broke a record this year. The good news is that once the natural gas from the Harish rig starts flowing, this record can be smashed once more soon.

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