Israel Likely to Maintain Chevron’s Gas Holdings to Preserve Regulatory Stability
Israel’s interministerial committee on natural gas policy, led by Energy Ministry Director-General Yossi Dayan, is expected to avoid recommending changes to Chevron’s position in Israel’s gas market. The committee, which has been deliberating for over two years and is nearing its final report, aims to maintain regulatory certainty for investors by not forcing Chevron to divest its stakes in the Tamar or Leviathan gas fields. This decision counters earlier proposals from the Finance Ministry and the Competition Authority that sought to enhance competition by compelling Chevron to sell part of its holdings.
Chevron controls about 90% of Israel’s gas reserves, holding 25% of Tamar and operating Leviathan with a 40% stake. Tamar contains approximately 300 billion cubic meters (BCM) of natural gas, while Leviathan holds about 600 BCM. The committee’s approach reflects concerns that regulatory upheaval could deter international energy companies from investing in Israel, especially amid ongoing regional geopolitical tensions and the upcoming fifth offshore gas exploration tender covering 8,600 square kilometers.
Energy officials emphasize the importance of a stable regulatory environment to attract global energy giants, citing ongoing negotiations between ExxonMobil and Energean for potential collaboration in the new exploration round. The committee’s final report, delayed for months, is also expected to address the surge in demand for electricity connections by data centers, which could require decades-long infrastructure development and raise questions about balancing Israel’s energy security with commercial interests.
The backdrop includes a major gas export deal to Egypt worth 112 billion shekels, pushed under U.S. pressure, which has raised concerns about Israel’s long-term energy independence. State Comptroller Matanyahu Englman warned in June that Israel’s energy autonomy could be severely compromised within 22 years due to export deals, delays in policy decisions, and lack of infrastructure for gas imports, despite natural gas accounting for over 70% of the country’s fuel mix.
The committee’s final recommendations remain uncertain due to the upcoming October 27 elections, which may delay policy implementation. However, the prevailing sentiment is to avoid drastic regulatory changes that could destabilize the market and investor confidence.
