Court Order Threatens Leviathan Output

Wednesday, December 18, 2019

Companies developing the huge natural gas field Leviathan will try to convince an Israeli court on Wednesday to remove an injunction that threatens to delay production due to environmental concerns.

On Tuesday, the Jerusalem District Court, in a surprise decision, issued a temporary order that barred any gas emissions from Leviathan, effectively putting the project, which was due to come on line this month, on hold.

It was unclear how long the delay would last. The companies, led by Texas-based Noble Energy and Israel's Delek Drilling, have already signed major, multi-billion dollar export deals to Egypt and Jordan.

The hearing was moved up from the original date of Sunday.

Delek said it saw its chances of the getting the injunction cancelled as "greater than 50%".

Should the injunction be withdrawn on Wednesday, Delek said: "the transport of the natural gas from the Leviathan reservoir is expected to begin shortly thereafter, and accordingly, no delay is expected in the planned timetables for commencement of commercial production."

Shares in the two Israeli partners in Leviathan, Delek and Ratio Oil, traded higher on Wednesday despite the uncertainty.

Leviathan was discovered in 2010 about 120 km (75 miles) off Israel's coast. But its towering production platform was constructed much closer to shore - just 10 km away.

Environmental activists and municipalities located near where the pipeline comes ashore had tried unsuccessfully - including at the country's Supreme Court - to block the plan and force it to be built further out at sea.

The Leviathan partners are now waiting to open the wells and fill the subsea pipeline with natural gas, a process that sends emissions into the air.

The latest petition to halt the process was brought by several municipalities and an environmental group against the project's operator, Noble, and Israel's Environmental Protection Ministry.

The court said it issued the injunction because concerns over public health had still not been sufficiently disproved.

(Reporting by Ari Rabinovitch; editing by David Evans)

Categories: Legal Environmental Middle East Natural Gas Regulations

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