Israel starts exporting natural gas to Egypt in diplomatic milestone
The contract marks first such deal between the countries since they signed a peace pact in 1979. The historic partnership is set to last for 15 years.
Israel began exporting natural gas to Egypt on Wednesday, under a historic, 15-year deal between the two countries.
The inauguration of the contract marks the first time that Egypt, which in 1979 became the first Arab country to sign a peace pact with Israel, has imported gas from the country.The deal is expected to boost regional ties, and Egypt hopes the new agreement will help it become a regional energy hub. Egypt is also set to allow Israel to export some of its natural gas to Europe through Egypt’s liquefied natural gas (LNG) facilities.Those intercontinental exports are expected to start taking place by 2025. Egypt currently exports one billion cubic feet of gas to Europe every month, said Egyptian Oil Minister Tarek al-Mula in a statement on Wednesday. Israel will start by exporting 5,663,000 cubic meters of gas per day to its North African neighbor.Israeli officials and Middle East gas executives alike have touted the new partnership as the most significant deal signed since the countries made peace with one another. “Today marks a new era in the Middle East energy sector,” said Yossi Abu, the CEO of the Israeli Delek drilling company, one of the partners on the project.
A private firm in Egypt, Dolphinus Holdings, will purchase 85 billion cubic meters (bcm) of gas, worth an estimated US$19.5 billion (€17.5 billion) from Israel’s Leviathan and Tamar gas fields.
Israel has pegged the Leviathan gas field, which is about 130 kilometers (81 miles) west of the Israeli port city of Haifa, as its main source of the product, with an estimated 605 billion cubic meters in reserves.
Israeli Energy Minister Yuval Steinitz and Mula said in a joint statement that the new deal would help both countries economically. Steinitz also descibred the deal as the first of its kind in decades.
Israel had previously purchased gas from Egypt, but sections of the pipeline between the two were repeatedly targeted by Sinai jihadists in 2011 and 2012. The country is also tipped to start exporting natural gas to Jordan in the near future.
Source: dw.com