Drilling for oil suspended at Israel's Leviathan
JERUSALEM May 3 (Reuters) - A U.S.-Israeli exploration group that discovered huge natural gas reserves at the Leviathan field offshore Israel said on Thursday that technical problems have forced it to suspend drilling at a deeper well on site where it hopes to find oil.
The Leviathan field, discovered in 2010 off Israel's Mediteranean coast, was the largest deepwater natural gas find of the past decade, with reserves estimated at about 17 trillion cubic feet (tcf). The group is now hoping to find some 600 million barrels of oil hidden in a layer beneath the gas.
But high pressures at the site and mechanical limitations of the well, where drilling had reached deeper than any other spot in the east Mediteranean's Levant Basin, forced a halt in operations before target depth was reached, the Israeli partners told the Tel Aviv Stock Exchange.
The consortium, led by Texas-based Noble Energy and Israel's Delek Energy, also said it found geological signs that could point to the presence of hydrocarbons.
"Based on the information received to date, we continue to believe there is potential for significant oil resources in this prospect and the basin," Susan Cunningham, Noble's senior vice-president of exploration and business innovation, said in a statement.
The problems at the drill site will not affect the natural gas already discovered at Leviathan, the companies said. Production there is expected to begin in 2017. Noble has had to halt drilling at Leviathan in the past for technical reasons.
One official with knowledge of the drilling said the suspension could last until the end of 2013.
Energy analysts saw the announcement as both good and bad.
"So no oil this time around and further delays and perhaps disappointment for some," said Citigroup's Michael Klahr. "But there are some encouraging signs for further gas and oil in the basin."