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(Bloomberg) — Noble Energy Inc. expects to formally approve at least one natural gas development in waters off the coast of Israel by the end of next year.

Gas would probably begin to flow from one or both of the discoveries three to four years after Noble’s board makes so- called final investment decisions, or FIDs, Chief Executive Officer David Stover said during a conference call with analysts and investors on Monday.

With the Israeli government establishing the regulatory framework that will govern offshore energy ventures, Noble is set to begin harvesting more than 50 trillion feet of gas it has discovered in the Tamar and Leviathan fields in the eastern Mediterranean Sea. Tamar, where the first phase of output began in 2013, already supplies the gas used to make half of Israel’s electricity.
“We’ve been looking at kind of a time frame of about a year to bring all of this together to move to FID,” Stover said during the call. “I think when you look at actual first production, we’ve been talking three years to four years from FID, the first production. There is probably an opportunity that Tamar’s project could be probably a little bit quicker than Leviathan, but we’ll just have to see how that plays out.”

Israel Framework

Israeli Economy Minister Aryeh Deri’s comment that he’s prepared to leave the ministry was seen as removing an obstacle to finalizing a regulatory framework for developing the country’s offshore gas reserves. Prime Minister Benjamin Netanyahu said Sunday that he will take over Deri’s responsibilities at the economy ministry.

“Deri was the main obstacle to the framework,” Noam Pincu, an analyst at Psagot Investment House Ltd. in Tel Aviv, said by phone. “Now the companies can proceed with the development of Leviathan and Tamar and start signing contracts.”

The company expects to benefit from the knock-on effects of the 16-month rout in energy prices; canceled drilling projects around the world have slashed demand and costs to lease and buy equipment. As a result, Stover said Noble will rebid its Israeli projects and develop new cost estimates around the middle of 2016.

Noble rose 5.9 percent to $37.97 in New York Monday, a two- month high.

–With assistance from Shoshanna Solomon in Tel Aviv and Calev Ben-David in Jerusalem.

To contact the reporter on this story: Joe Carroll in Chicago at jcarroll8@bloomberg.net To contact the editors responsible for this story: David Marino at dmarino4@bloomberg.net Jeffrey Taylor