There is now official confirmation that commercial quantities of natural gas have been found in the Dalit-1 well in the Michal prospect, offshore from Hadera. Noble Energy Inc. (NYSE: NBL) yesterday that the flow tests on the well on a limited section of the reservoir yielded a flow rate of 33 million cubic feet per day of natural gas, limited by testing equipment available on the rig. Performance modeling indicates the well can be ultimately achieve a production rate of about 200 million cubic feet per day.
The production rate at the Dalit-1 well is quite high for a single well, and will reportedly increase the feasibility of commercial gas production at it.
For the sake of comparison, natural gas production at the Mary well, owned by Delek Group Ltd. (TASE: DLEKG) unit Yam Tethys, offshore from Ashekelon, amounts to 100 million cubic meters per day, and production at the Tamar-1 well in the Matan prospect, was estimated at up to 150 million cubic meters per day. However, the Matan prospect's reserves were recently cut by 30% to 14-15 billion cubic meters, compared with Noble Energy's original estimate of 20 billion cubic meters.
Noble Energy estimates that, based on log and test results, Dalit has about 500 billion cubic feet of natural gas. Noble Energy owns 36% of the Michael prospect, Isramco Ltd. (Nasdaq: ISRL; TASE: ISRA.L), owns 28.75%, Delek Group subsidiaries Delek Drilling LP (TASE: DEDR.L) and Avner Oil and Gas LP (TASE: AVNR.L) each own 15.625%, and Alon Israel Oil Company Ltd. subsidiary Dor Gas Exploration Ltd. owns 4%. The partnership also owns, in the same proportions, the Matan prospect, where the Tamar-1 well is located, offshore from Haifa, where commercial quantities of gas were found earlier this year.
Noble Energy added that the rig will immediately return from the Dalit-1 well to the Tamar well to drill an appraisal well designed to better define the resources of Tamar. The current estimated gross mean resource potential of Tamar is 5 trillion cubic feet of natural gas.
Noble Energy chairman, president and CEO Charles D. Davidson said, "These results are very encouraging. Even though Dalit is smaller than Tamar, the discovery of this high quality reservoir adds important natural gas resources for development and gives us further confidence that our geologic model for this region is working very well."
Isramco's share fell 15.2% on Nasdaq yesterday to $36.01, and fell 7.5% in early trading on the TASE today to NIS 0.51. Delek Group's share rose 3.1% to NIS 414.90, but Delek Drilling's share fell 1.1% to NIS 4.17 and Avner Oil's share fell 4.5% to NIS 0.70.
Published by Globes [online], Israel business news - www.globes-online.com - on April 16, 2009
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