First sale for newly approved Israeli gas project

 30 May 2016 - 12:41

First sale for newly approved Israeli gas project

 

Jerusalem: The US-led consortium leading the development of Israel's offshore gas reserves has announced its first sales deal since a reworked agreement on a key offshore field was given the go-ahead.

The consortium, led by US firm Noble Energy, Sunday announced a $3-billion deal to supply 13 billion cubic metres of natural gas from the Leviathan field to a power plant in southern Israel over the next 18 years.

It was the second sales deal confirmed by the consortium but the first since the government ratified the offshore development project on May 22, after a legal battle had delayed it.

The entire development project had been shot down by the supreme court as unconstitutional, with critics saying it gave too much power to the energy companies.

After the ruling, the agreement was then revised to reflect the court's objections and the government subsequently gave it the green light.

Leviathan is the largest of Israel's offshore gas fields, with enough gas to turn the previously resource-poor country into a significant exporter.

Key potential markets are Turkey and Egypt.

Yossi Abu, CEO of Delek Drilling, the Israeli company in the consortium, hailed the new sales agreement.

In a statement, he said it was the first of many to be signed in the coming months and that the field would supply gas to the domestic market by 2019.

AFP