Israel Signs ‘Historic’ Deals to Sell Gas to Egypt

  • 2/20/2018
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Israel struck two historic agreements with Cairo to sell $15 billion worth of natural gas to Egypt. The Israeli energy group Delek said on Monday agreements have been signed between Delek and its associate Noble Energy of the United States to supply 64 billion cubic meters (2.26 trillion cubic feet) of gas from Israels Leviathan and Tamar offshore fields to the Egyptian firm Dolphinus over a 10-year period. Israeli Prime Minister Benjamin Netanyahu deemed the deals as “historic”, while sources told Asharq Al-Awsat that they have a “trade” nature and are not affiliated with the Egyptian government. They explained that the government was not involved in the agreement because talks over gas imports with Israel are currently halted. Tamar, which began production in 2013, has estimated reserves of up to 238 billion cubic meters (8.4 trillion cubic feet). Leviathan, discovered in 2010 and set to begin production in 2019, is estimated to hold 18.9 trillion cubic feet (535 billion cubic meters) of natural gas, along with 34.1 million barrels of condensate. “Egypt is becoming a real gas hub,” Yossi Abu, CEO of Delek subsidiary Delek Drilling LP, told Reuters. “This deal is the first deal of potentially more to come.” The partners have also been trying to finalize a long-term deal to supply a Royal Dutch Shell Plc plant in Egypt. Egyptian Petroleum Minister Tarek El Molla told the private Egyptian television channel ON E that outstanding disputes would have to be resolved for the deal to go through. Molla’s comments refer to Egypt’s challenge to a 2015 ruling by the International Chamber of Commerce ordering Egypt to pay $2 billion in compensation after a deal to export gas to Israel via pipeline collapsed in 2012 due to months of attacks by extremists in Egypt’s Sinai peninsula. “We don’t mind importing gas from Israel, but we have terms in order (to allow) something like this to happen ... most importantly, the settlement of ongoing arbitration,” Molla said. An Egyptian government official who declined to be identified said the deal did not mean Egypt itself would import any gas from abroad. “International private companies will import gas from abroad in the framework of their own needs, and will liquefy and export them again,” the official said, without elaborating.

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