Wood Group, the Scottish oil and energy services giant, is poised to reap rich rewards after a massive offshore natural gas reserve was discovered earlier this week off the coast of Israel.
Early last month, Wood struck an $875 million (£563.3m) deal – one of the company’s largest to date – to build an 800-megawatt, natural gas-fired power plant in Israel and will provide around 8% of the country’s total installed power generation capacity.
Wood Group GTS has full turnkey responsibility for the combined-cycle plant: from design, procurement and construction through to commissioning and handover.
The Dorad Power Plant, near the town of Ashkelon, is expected to be online within 36 months.
Wood Group declined to comment on the giant gas discovery, 80 miles off the Mediterranean port of Haifa, or its fortuitous timing, given that the Dorad deal was struck just a month ago.
Industry observers say the find presents multiple opportunities for the Aberdeen-based company – from extended maintenance contracts to extending the plant or even constructing further plants to accommodate the new discovery.
The giant field is estimated to contain 16 trillion cubic feet of gas: equivalent to more than a quarter of Canada’s proven reserves and enough to meet Israel’s demand for 100 years.
The field, which also has far-reaching political and economic ramifications because it will free energy-poor Israel from the threat of oil boycotts, is the world’s largest deepwater gas discovery in a decade.
Potentially in Wood’s favour, Israel will need to construct an infrastructure big enough to cope with the enormous find.
Last month The Herald reported that Wood’s landmark Israel deal had also marked the easing of political tension between Israel and Turkey, because the project is 25% owned by Turkish electricity producer Zorlu Enerji.
Zorlu’s part in the project has been part-financed by loans from Tel Aviv-based Bank Hapoalim and Clal Finance, and marked the largest business deal between Turkey and Israel since relations between them crumbled in the wake of the Israeli raid on the Gaza-bound Turkish aid flotilla in May.
