By Avi Bar-Eli

Oil and gas exploration partnerships controlled by Jacob Maimon may have found yet more gas in the Mediterranean seabed. However, it may not be worth the companies’ effort to find out any more about what they might have discovered.

Isramco and other Maimon partnerships yesterday reported the results of a three-dimensional seismic survey carried out beneath the Mediterranean floor, in the license area known as Shimshon, near the nautical boundary between Israel and the Gaza Strip. They say the probability that the geological formation at the site contains 43 billion cubic meters of natural gas is about 15%.

Those odds are considered relatively low compared, for example, to the 35% probability of success reported before drilling began at the nearby Tamar site, or the 50% assessment at the Leviathan site.

However, these are odds that nonetheless justify drilling operations, based on world standards.

The reason for the low probability assessment is linked in part to the open geological structure of the Shimshon prospect (something akin to a strip mall as opposed to an enclosed mall ). By contrast, the Tamar field features a closed structure that increased the probability of successful exploitation of its gas-bearing strata.

The depth of the geological structure at Shimshon is similar to that at Tamar, about 4,500 meters below sea level, of which the top 1,200 meters are water and the rest solid seabed.

The Shimshon license area encompasses about 400 square kilometers of the Mediterranean near the official nautical border between Israel and the Palestinian Authority.

Maimon’s gas partnerships – Isramco, INOC Dead Sea Limited Partnership (known as Hanal ) and Naphtha – together own nearly 29% of the rights to natural gas finds at Tamar and Dalit, which contain an estimated 261 billion cubic meters of gas, as well as a 72% stake in the Or prospect site. The Or license is held by Med-Yavne, where 1 billion cubic meters of gas has been identified.

Spoiled rotten

“We’ve gotten used to good news,” Isramco CEO Yossi Levy told TheMarker yesterday. “It has to be understood that percentages of success such as occurred at Tamar are not common in the world. Exploring formations at a drilling site like Shimshon has never been carried out in Israel, but such drilling has been done in Egypt, where a lot of gas has been found in similar strata. The only way to know what is to be found there is to drill.”

He said Isramco is currently facing a tough dilemma over whether to conduct a preliminary exploration drilling operation at the Shimshon site. Levy says the only obstacle facing the company now is the extent of the market for natural gas that might be found.

“Everywhere where there is a market, a site like this would have been explored immediately,” said Levy. “The primary question is where the gas will go, and that is something that everyone searching in the Mediterranean these days will have to answer after they find gas. Relatively small reserves are ideal for the local market, but the question is how it’s possible to compete [in selling] the larger reserves.”

Levy’s remarks were directed at the new exploration partnerships, such as Nochi Dankner and Yitzhak Sultan’s Modiin Energy, which is now in the early stages of gas exploration.

This week, Isramco presented its findings from the geological survey of the Shimshon site to Yaakov Mimran, the National Infrastructure Ministry official responsible for overseeing gas exploration activities.

Mimran extended Isramco’s license at Shimshon by a year, requiring the firm to seal a drilling contract by the end of this year and conclude drilling by June of 2011. If there is exploratory drilling at the Shimshon site, the operation is expected to cost about $75 million.