Save for later Print Download Share LinkedIn Twitter Egypt and Israel discussed plans on Aug. 9 to liquefy Israeli gas for re-export from Egyptian LNG export terminals, as both sides build on existing cooperation. The talks come as current Egyptian gas demand reached a record 4.67 billion cubic feet per day, Cairo stated. The Egyptian-Israeli talks came under the framework of the East Mediterranean Gas Forum, which aimed to strengthen “bilateral and multilateral cooperation among the forum’s members to unlock the full potential of natural gas in the region,” a joint statement on Facebook read (LNGI Jun.14'21). East Mediterranean Gas Forum The forum was launched in September 2020 by Egypt, Israel, Cyprus, Greece, Italy, Jordan and the Palestinian Authority (PA). Backed by the EU, Washington, the International Monetary Fund and the World Bank, the forum seeks to promote gas exports and cooperation on the use of existing gas infrastructure in the region. France is now a member and the United Arab Emirates was initially announced by Cairo as an observer to the forum but was later blocked by the PA. The US has observer status. Egypt-Israel Subsea Pipe from Leviathan Back in February Israel and Egypt announced they were working on an intergovernmental agreement to build a new offshore pipeline connecting Israel's 22 trillion cubic foot Leviathan offshore gas field to one of Egypt's twin LNG export plants at Idku and Damietta on the Mediterranean coast (LNGI Feb.22'21). It is unclear yet which plant will be favored although both are connected to the Egyptian gas grid. Since January 2020 Israel has shipped gas from Leviathan to Egypt via the existing East Mediterranean Gas Corp. pipeline. Egypt Gas Hub Ambitions Cairo has long harbored ambitions to promote itself as a gas trading hub for the broader East Mediterranean region, which has seen a series of large gas discoveries in recent years. Israel-Egypt state-to-state talks build on earlier provisional agreements for former Leviathan operator Noble Energy -- since acquired by Chevron -- to transport gas from Leviathan and Israel's 11 Tcf Israeli Tamar field to Egypt's LNG export plants at Idku and Damietta. Chevron FLNG Option After taking over Noble, Chevron acquired some 35 Tcf of recoverable gas resources, taking over operatorship of Leviathan, Tamar and the 4.1 Tcf Aphrodite field offshore Cyprus. The US supermajor inherited piped gas export contracts from Leviathan to Egypt and Jordan and last month with Israeli partner Delek, extended a contract with Belgium’s Exmar to promote a second phase development of Leviathan involving a floating LNG facility (LNGI Jun.16'21). Provisional Israeli Piped Gas Deals to Egypt Noble signed a letter of intent in 2014 to ship gas by pipeline from the Tamar field to the Damietta LNG plant, which was operated by Spain's Union Fenosa Gas at the time. Damietta is now operated by Italy's Eni. The provisional deal was to supply 2.5 Tcf or 440 million cubic feet per day over 15 years. Noble also signed a similar letter of intent to supply gas from the Leviathan field to the Idku plant, which was operated by the UK's BG at the time. Idku is now operated by Royal Dutch Shell. The nonbinding deal was to supply 7 billion cubic meters per year (677 million cubic feet per day) to the plant. Rising Egypt Gas Demand Gas demand in Egypt’s power sector has soared in recent months in line with high summer temperatures, which has seen increased air conditioning demand. “The current volumes of natural gas that were consumed in power stations amounted to 4.67 Bcf/d, representing about 67% of gas consumption locally,” the ministry said in a statement on Aug. 6. Despite the high gas-for-power demand, the ministry said Egypt had still been able to meet gas demand in other sectors, including industry, petrochemicals, residential and fuel for cars. It also continued to provide gas for LNG exports, it added. Tom Pepper, London
