Israel is set to start natural gas exports to Egypt within four months, Israeli Energy Minister Yuval Steinitz told Reuters on Wednesday.
Israel and Egypt, which mark this year 40 years since signing a peace treaty in 1979, have made meaningful advances in their natural gas industries in recent years and are competing to become Eastern Mediterranean's next energy hub.
The deal under which Israel will export natural gas to Egypt has been described by Israeli officials as one of the most important bilateral agreements since the two countries made peace 40 years ago.
At the beginning of last year, Israel's Delek Group and Houston-based Noble Energy-the main partners in two large gas fields offshore Israel-signed agreements to sell significant quantities of natural gas from the Leviathan and Tamar fields to Dolphinus Holdings to supply gas in Egypt.
These agreements, one for natural gas from Leviathan and one for Tamar, each provide for total contract quantities of 1.15 trillion cubic feet of natural gas. The natural gas sales, both under 10-year contracts, are expected to supply industrial and petrochemical customers as well as future power generation in Egypt, Noble Energy said in February 2018.
Delek has estimated that the total revenues from the Tamar and the Leviathan gas sale deals to Egypt may reach US$15 billion.
It's not only Israel that has seen natural gas fields developed and turning around its domestic industry-Egypt also has a lot to show off.
Following the start-up of the giant gas field Zohr, Egypt has become an important player in the Mediterranean. Zohr, discovered by Eni in 2015, plays a key role in helping Egypt to avoid the need to import liquefied natural gas (LNG), according to the Italian oil and gas major.
Egypt received last year the backing of the World Bank in its efforts to be a regional oil and gas trading hub, as several new gas projects started up recently in the East Mediterranean country.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More