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In Historic Deal, Egypt Agrees to Buy $15 Billion of Natural Gas from Israel

The partners in Israel’s Tamar and Leviathan natural gas fields have signed a landmark $15 billion deal to export natural gas to Egypt over the next decade.

Delek Drilling told the Tel Aviv stock exchange that Noble Energy Mediterranean signed an agreement with Egypt’s Dolphinus Holdings Ltd for the sale of 64bn cubic meters of natural gas.

Israeli Prime Minister Benjamin Netanyahu welcomed “the historic agreement” which “will bring billions to the country and will aid in the education, health and welfare of Israeli citizens.”

The deal, which has no start date at present, will involve half of the gas coming from the active Tamar gas field. The other half will come from the Leviathan field, which is in development and expected to begin operations in 2019.

It is not yet clear how the gas from both fields will be transported to Egypt. Delek Group, which controls Delek Drilling, said a number of options were being considered, including connecting Egypt to Israel’s own transmission network and using the pipelines to the east Mediterranean and Jordan.

Israel’s Minister of National Infrastructure, Energy and Water Resources Yuval Steinitz hailed the announcement as the most significant deal with Egypt since the 1979 peace accord.

The controlling shareholder of Delek Group, Yitzhak Tshuva, said the deal would “strengthen the relationship between Israel and its neighbours and increase economic cooperation between them”.

The Leviathan and Tamar natural gas fields were discovered in 2010 and are thought to contain 800 billion cubic meters of gas. Since early 2017, gas from Tamar has been exported to a Jordanian chemical manufacturing plant on the Dead Sea.

(via BICOM)

[Photo: BICOM]