Israel approves gas exports to Egypt

Israeli Energy Minister Yuval Steinitz approved the deal on Monday.(File photo: AFP)

Israel has approved the export of gas from its offshore reserves to Egypt, a spokeswoman said Tuesday, with a major reservoir expected to begin operations imminently.

The Monday approval by Energy Minister Yuval Steinitz was part of a long process under which Israel will transform from an importer of natural gas from Egypt into an exporter and potential regional energy player.

“Exporting gas to Egypt, from Leviathan and Tamar (fields), is the most significant economic cooperation between Israel and Egypt since the peace treaty was signed between the states,” Steinitz said.

It will be the first time Egypt, which in 1979 became the first Arab country to sign a peace accord with Israel, imports gas from its neighbor.

US-based Noble and Israel's Delek, the consortium leading the development of the two offshore reservoirs, struck a $15 billion 10-year deal last year with Egypt’s Dolphinus to supply 64 billion cubic metres (2.26 trillion cubic feet).

Israel had previously bought gas from Egypt, but land sections of the pipeline were targeted multiple times by Sinai jihadists in 2011 and 2012.

Soaring demand also meant Egypt could use its gas domestically.

Tamar, which began production in 2013, has estimated reserves of up to 238 billion cubic metres (8.4 trillion cubic feet). Israel’s neighbor to the east, Jordan, has been purchasing gas from Tamar on a small scale for nearly three years.

Leviathan, discovered in 2010, is estimated to hold 535 billion cubic metres (18.9 trillion cubic feet) of natural gas, along with 34.1 million barrels of condensate.

Leviathan is expected to be operational in “a matter of days”, a spokeswoman for Delek told AFP, with exports to Egypt set to begin on January 1.

The large volume of the Egyptian deal would make Israel “an important partner in the regional energy economy,” Steinitz said.

“The natural gas revolution has made us an energy superpower and will not only provide huge income to the state but also a significant reduction in air pollution.”

Besides being energy independent, Israel hopes its gas reserves will enable it to strengthen strategic ties in the region and help forge new ones, with an eye on the European market.

Natural gas is set to replace coal as the fuel generating electricity in Israel's power plants.

Critics note that while less polluting than coal, gas is still far from being a clean source of energy.
 

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Last Update: 11:44 KSA 14:44 - GMT 11:44
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