Oil in Israel!

Higher Oil Prices Prompt Israel to Search for 'Black Gold'
By Julie Stahl
CNSNews.com Jerusalem Bureau Chief
October 06, 2006

Jerusalem (CNSNews.com) - Higher oil prices prompted an Israeli oil concern to re-open an abandoned oil well in southern Israel recently, and what experts found has encouraged them that Israel may have significant quantities of oil that could be very important to the country.

Situated in the oil-rich neighborhood of the Middle East, very little oil has nevertheless been discovered in Israel. But that may change soon.

Testing for oil in the area of the Dead Sea in southern Israel has been "very encouraging," said Dr. Eli Tannenbaum, geological consultant of Ginko Oil Exploration, which is a private company conducting the explorations.

Recently, Ginko re-opened an old well that had been active from 1995-97. It was abandoned because international oil prices were very low at the time -- $15-20 a barrel -- and it was not financially viable.

"Since then, prices have quadrupled, and it might [now] be economical," Tannenbaum said in a telephone interview.

What Ginko found when they re-opened the well was that the oil pressure was good, and oil flowed freely. But the significance of the well is not about the quantities that are produced there, Tannenbaum said.

The company is doing more comprehensive testing. About two kilometers north of the current well, Ginko found a "hydro-carbon trap" (a geological area where oil is found), and it could yield an estimated 4-6 million barrels of oil, he said.

If there is a well like this on the same layer as the current well, then it follows that there could be other wells, too, that would also produce quantities of oil, he added.

"There is quite a big potential here," said Tannenbaum. If "significant quantities" are found, it would be "very important" to Israel, he said without elaborating.

Israel currently imports most of its oil from the former Soviet Union and the remainder from West Africa, Egypt and Mexico. Gasoline prices in Israel currently are more than $5.00 per gallon.

Tannenbaum said that Ginko is working on 10 prospects and hopes they will be able to drill at each one and "prove their potential," he said.

The Dead Sea, the lowest point on earth, is packed with minerals and is already mined for its potassium and bromine. Both Israel and Jordan sit on its shores.

Jordan also previously found oil in the area, but it was not enough to make it commercially viable, Tannenbaum said. According to Ginko's surveys, most of the oil would be found on the Israeli side of the Dead Sea, he added.