Egypt and Israel Seek New Gas Routes to Bolster Energy Trade

SEATTLE (Oil Monster):  Egypt and Israel are discussing new routes to transport natural gas to the Arab country, which would allow the companies developing Israel’s largest natural gas reservoirs to export volumes beyond a $15 billion deal signed last year.

The two countries are considering an “additional connection” to the system of pipelines linking them, Israel’s Energy Minister Yuval Steinitz said in an interview at a conference in Cairo.

“It could be onshore or offshore,” Steinitz said. “We are open to all options.”

Egypt and Israel have been pushing for more gas deals to bolster the region’s position as an emerging energy hub. Nearly 10 years after companies led by Noble Energy Inc. and Delek Drilling LP found major gas fields in Israeli waters, they signed a landmark contract with Egypt’s Dolphinus Holdings Ltd. The firms, however, have struggled to find buyers for the vast majority of the discovered fuel.

Political tension has held back progress on new deals. Mass protests broke out in Amman shortly after the partners in Leviathan, Israel’s biggest gas reservoir, signed a $10 billion contract with Jordan in 2016.

Still, there’s growing demand for natural gas in the region. Major European countries have expressed interest in buying Israel’s gas, Steinitz has said in the past.

To that end, Israel, Cyprus, Greece and Italy are working on the so-called East Med project, an estimated $7 billion route that stands to be the world’s longest subsea pipeline and would allow gas exports to southern Europe.

Steinitz said he expects the countries to sign a final agreement that would let companies start work on the East Med project within the next two months.

If there’s surplus gas being produced by Egypt, Israel and Cyprus, “then we should export not only to Europe, but also to the east -- mainly India -- then other countries can come later,” he said.

Courtesy: www.bloomberg.com