September 30, 2014 / 10:53 AM / 5 years ago

Israel's Leviathan gas field group submits $6.5 bln development plan

JERUSALEM, Sept 30 (Reuters) - The partners in Leviathan, Israel’s largest natural gas field, have submitted their initial development plan to Israeli authorities, which one source said on Tuesday envisages producing 16 billion cubic metres (bcm) of gas a year.

The group, led by Texas-based Noble Energy and Israel’s Delek Group, handed in its proposal after months of trying to determine the best way to develop the Mediterranean field, which lies in about 1500 metres of water about 80 miles (130 kilometres) off Israel’s coast.

Talks to bring in Australia’s Woodside Petroleum, a liquefied natural gas (LNG) specialist, fell through in March.

With estimated reserves of 622 bcm, Leviathan is one of the world’s largest offshore discoveries of the past decade.

A spokeswoman for Israel’s Energy Ministry, which must now approve the plan, confirmed it had been received, but disclosed no details.

An industry source said the first stage will see a floating production storage and offloading (FPSO) unit passing 16 bcm of gas a year via pipelines to Israel, the Palestinian Authority and other neighbours that decide to buy the gas.

Production is expected to begin by 2018 and initial investment could reach $6.5 billion, the source said, which was in line with previous forecasts.

The Leviathan partners are in talks with Britain’s BG Group , which wants to bring gas in to feed its Egyptian LNG export plant, and with Jordan’s national electricity company.

Later development plans were not included in the proposal, and could include direct LNG exports to more distant markets, officials have said. (Reporting by Ari Rabinovitch; Editing by Greg Mahlich)

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