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Jordan signs multi-billion pound deal to purchase Israeli gas

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A deal was finalised yesterday worth £7.7bn over 15 years to supply Jordan with Israeli natural gas.

The agreement will see Jordan receive around 45 trillion cubic metres of gas from the Leviathan offshore field, making Israel Jordan’s primary gas supplier.

Israeli company Delek Drilling and American firm Noble Energy hold controlling stakes in Leviathan and the smaller Tamar field. Yesterday’s agreement was signed between the Leviathan consortium and the Jordanian Electric Power Company.

Delek Drilling CEO Yossi Abu told the NRG news website that it was an “historic day” and that the agreement “establishes the Leviathan oilfield as a serious player on the energy map”.

Abu added that the deal will “contribute to the prosperity of Israel and Jordan and will strengthen ties and active partnerships between the two,” and that consequently, “the Leviathan consortium will continue to push forward additional deals including with Egypt, Turkey and the Palestinian Authority”.

Israel’s Energy Minister Yuval Steinitz also enthusiastically welcomed yesterday’s agreement.

He said: “This is a historic moment in which Israel is becoming for the first time an exporter of energy and natural gas.”

He added: “I have no doubt that additional agreements with other countries will come in the future, along with additional gas discoveries”.

Steinitz said that critics of the government’s management of the nascent natural gas industry “should ask the forgiveness of the people of Israel”. However, Zionist Union MK Shelly Yachimovich accused Steinitz of “unfathomable and disturbing ignorance”. Yachimovich is one of the leading opponents of a controversial agreement finalised late last year between the state and major investors, including Noble and Delek.

In December 2014, Israel’s Antitrust Regulator recommended ending Noble and Delek’s dominance in Israel’s natural gas development. A year later, following much wrangling, an agreement was reached which regulates the industry in general, including the share of profits. However, during that period, public protests took place, accusing the government of bowing to corporate greed.