UPDATE 1-Exploration group announces new gas find off Israel

Sun Jun 3, 2012 4:25am EDT

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JERUSALEM, June 3 (Reuters) - Exploration firm Israel Opportunity said on Sunday there is potentially 6.7 trillion cubic feet (tcf) of natural gas and 1.4 billion barrels of oil at its Pelagic fields offshore Israel, with a relatively high probability for geological success.

The estimate comes from a resources report, made by Texas-based petroleum consultant Ryder Scott, which covers five different sites about 170 kms off Israel's coast, the company said in a statement.

Exploration groups have discovered large deposits of natural gas in the Eastern Mediterranean in recent years and a slew of oil and gas companies have bought into the licenses offshore Israel and Cyprus in hope of making the next big discovery.

The Pelagic fields were given a high geological probability for success in global standards, between 28.5 to 76.7 percent depending on the exact site, in part because of its proximity to even larger proven fields nearby, Israel Opportunity said.

In the same area are the Tamar field, with some 9 tcf of gas, and Leviathan, which was the world's largest deep-sea find of the past decade with an estimated 17 tcf of natural gas.

"The data from the resources report are even better than the estimates Israel Opporunity had when it first chose to enter the Pelagic licenses," company Chairman Rony Halman said.

Israel Opportunity has a 10 percent stake in the Pelagic licenses and the fields' Norwegian operator AGR holds a 5 percent share. Israeli billionaires Benny Steinmetz and Teddy Sagi each control a 42.5 percent stake.

The consortium hopes to begin drilling at the first Pelagic site in the fourth quarter of 2012, which is when another Israeli-led group is supposed to finish using a drilling rig in the waters nearby, Israel Opportunity said.

It estimated the cost of drilling to be about $100 million. (Reporting by Ari Rabinovitch, Editing by Jonathan Thatcher)

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