Israel bolsters Egypt ties with $15bn gas deal

Oil&Gas Materials 20 February 2018 11:53 (UTC +04:00)

An Israeli energy company has announced a $15bn deal to export natural gas to Egypt, highlighting the deepening strategic ties between the two countries as well as Cairo’s ambitions to become a regional energy hub, Financial Times reports.

In what Yuval Steinitz, the Israeli energy minister, hailed as the most significant deal with Egypt since the countries’ 1979 peace accord, Israel’s Delek Group said it had signed an agreement to supply 64bn cubic metres of gas over a decade to Dolphinus Holdings, a private Egyptian company.

Delek is partners with the Texas-based Noble Group in developing Israel’s showpiece Tamar and Leviathan offshore gasfields, giant discoveries that promise to bolster the country’s energy security and transform it into a gas exporter.

Yossi Abu, chief executive of Delek Drilling, said he expected most of the gas involved in Monday’s deal to be used for Egypt’s domestic market, while predicting it could pave the way for wider cooperation.

Egypt already has extensive gas liquefaction facilities on the Mediterranean — used to create more easily exportable liquefied natural gas — which have stood largely idle since the country’s 2011 revolution led to a fall in its gas production.

“Many people did not believe in the gas outline,” Benjamin Netanyahu, Israeli prime minister, said, adding it would supply billions in tax revenues to Israeli coffers. “This is a joyous day.”

He added that the deal would “strengthen our economy [and] strengthen regional ties”.