Israel Gas Bonanza: New Field Discovered

Vilified, ostracised, threatened in the Middle East, Israel is about to join the Gulf Arab states as a fossil fuel giant that could tie it closer to its neighbours and Western Europe.

A natural gas bonanza is about to begin. By the end of this year Israel will be looking to shift the production of electricity to gas-powered generators producing half the Jewish state's wattage.

The change will save it \$12bn (£8m), which was the net extra cost caused by the need to import coal to cover the huge drop, from 40% of fuel for electrical generation to zero, caused by the destruction of gas pipelines from Egypt by militant groups.

As Eli Glickman, chief operating officer of Israel electric, said: "Israel was a state from the bible of milk and money, now we're going to be a state of milk, honey and gas."

Once entirely dependent on imported fuel, Israel will soon be a gas exporter - thanks to the discovery of the Levant gas field.

It extends from Lebanon to Gaza - and includes the Israeli-owned Tamar and Leviathan fields which came on line in April.

The bonanza has immediately resulted in greater co-operation, and joint naval exercises with Cyprus, which owns the Aphrodite field.

It could also cause Europe to view Israel more sympathetically because it may become a gas supplier that would reduce Russia's domination of supply.

And it could immediately improve relations with its neighbour, Jordan - which has also suffered severe economic turmoil caused by the collapse of its supplies from Egypt.

"Israel could possibly export gas to Jordan, strengthening bilateral relations with the Jordanians, and also possibly to the Palestinian Authority to allow them to produce their own power in their own power stations," said Dr Amit Mor, a leading independent energy consultant from EcoEnergy.

But the discovery of 150 years worth of gas for Israel, 26 trillion cubic feet, with similar amounts in Cyprus' maritime borders, may cause regional tensions.

Turkey is keen to get a share of the boom for the territory it holds in the north of the island.

And while the Lebanon has conceded Israeli control over Leviathan and Tamar, it insists that further exploration by Israeli companies may include operations that may be inside territory that it claims.

"Israel will soon be shifting almost all of its vehicles to gas power. We will be endings our dependency on fuel from other countries," Dr Mor explained.

That is good news for Israelis. But will this mean that an economically and power independent country would be more, or less, disposed to negotiating a long term solution the the occupation of the West bank and siege of the Gaza Strip?