Natural gas find in Mediterranean could lead to new Lebanon-Israel war

A large natural gas reserve has been discovered under the waters of the eastern Mediterranean, leading to claims from both countries.

BEIRUT // The discovery of large natural gas reserves under the waters of the eastern Mediterranean could potentially mean a huge economic windfall for Israel and Lebanon, both resource-poor nations - if it doesn't spark new war between them. The Hizbollah has said Israel plans to steal natural gas from Lebanese territory and vows to defend the resources with its arsenal of rockets. Israel said the fields it is developing do not extend into Lebanese waters, a claim experts say appears to be correct, but the maritime boundary between the two countries - still officially at war - has never been precisely set.

Hezbollah's executive council chief, Hashem Safieddine, said last month: "Lebanon's need for the resistance has doubled today in light of Israeli threats to steal Lebanon's oil wealth." The need to protect the offshore wealth "pushes us in the future to strengthen the resistance's capabilities." The threats cast a shadow over what could be a financial boon for both nations, with energy companies finding what appear to be substantial natural gas deposits in their waters.

Israel is far ahead in the race to develop the resources. Two fields, Tamar and Dalit, discovered last year, are due to start producing in 2012, and experts say their estimated combined reserves of 5.5 trillion cubic feet of natural gas can cover Israel's energy needs for the next two decades. In June, the US energy company Noble Energy, part of a consortium developing the fields, predicted that Israel will also have enough gas to export to Europe and Asia from a third field, Leviathan, thought to hold up to 16 trillion cubic feet of gas.

Israel relies entirely on imports to meet its energy needs, spending billions to bring natural gas from Egypt and coal from a variety of countries. When Tamar begins producing it could lower Israel's energy costs by US$1 billion a year and bring $400 million a year in royalties into government coffers. That suggests a total of about $40bn in savings and $16bn in government revenues over the total yield of the field. Those numbers would only rise as Leviathan comes on line.

Paul Rivlin, a senior research fellow with Tel Aviv University's Dayan centre, said: "Israel's always looked for oil. But I don't think it ever thought of itself as becoming a producer. And now that you've got a high-tech economy that's doing quite well, this comes as an added bonus." Hizbollah's warnings, however, quickly followed the announcement by the Texas-based Noble Energy. The Lebanese parliament speaker, Nabih Berri, a Hizbollah ally, warned that Israel is "turning into an oil emirate while ignoring the fact that the field extends, according to the maps, into Lebanon's territorial waters".

Israel's petroleum and mining commissioner at the national infrastructure ministry, Yaakov Mimran, called those claims "nonsense", saying Leviathan and the other two fields are all within Israel's economic zone. "Those noises occur when they smell gas. Until then, they sit quietly and let the other side spend the money," Mr Mimran told the Israeli daily Haaretz. Maps from Noble Energy show Leviathan within Israel's waters. An official with Norway's Petroleum Geo-Services, which is surveying gas fields in Lebanese waters, said, from Noble's reports, there is no reason to think Leviathan extends into Lebanon. * AP