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Israel to export gas to Egypt by 2018

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Bloomberg reported yesterday that natural gas could be shipped from Israel to Egypt, via Jordan, in a deal being negotiated between Egyptian energy giant Dolphinius Holdings, Israel’s Delek and US company Noble Energy.

Alla Arafa, co-founder of Dolpinius Holdings, told Bloomberg: “There is great potential for the Mediterranean to be a gas hub for the region and we want to be partners with Israel in this.”

The report follows significant developments this week in the natural gas industry in Egypt and Israel.

The Egyptian Government took a major step to end the state’s monopoly in the natural gas sector. President Abdel-Fattah al-Sisi signed a new law, called Resolution No. 196 of 2017 to establish a natural gas regulatory authority to open the gas market to competition from the private sector and license new providers. The law would allow the private sector to directly ship, transport, store, market and trade natural gas using the pipeline and network infrastructure, and will go into effect later this year. Egypt is one of two regional markets that could buy large quantities of gas from Israel’s Tamar and Leviathan gas fields.

David Stover, CEO of the American oil and natural gas company Noble Energy which partly operates the Tamar and Leviathan fields said: “The [Leviathan] team continues to progress on new contract discussions with customers in Israel, Jordan and Egypt. I’m confident that the gross 1.2bn cubic feet per day of Leviathan Phase 1 capacity will be mostly filled by start-ups.”

A gas pipeline between Israel and Egypt – who signed a peace agreement in 1979 – has been inactive for years after frequent sabotage by militants and the cancellation of an export contract by Egyptian importers in 2012.

Israel’s Energy Ministry published a plan this week to develop the Karish and Tanin natural gas fields, two smaller fields in the Mediterranean alongside the Tamar and Leviathan fields. The two fields are believed to contain 55bn cubic meters of gas, which according to the development plan should be flowing to Israel’s shores by 2020.