Israel andEgypt They are continuing to conduct advanced negotiations for gas deals worth up to $60 billion despite the high tensions in the region due to Operation Protective Edge, the Bloomberg website notes.
In an article published today (Thursday) on its website, Bloomberg explains why exporting Israeli gas through Egypt to Europe and Asia is the leading option for developing Israeli gas reserves today.
membership fuel andNobel are in advanced talks with the British BG and the Spanish Union Penosa companies, for the sale of 6.25 trillion cubic meters (TCF) of gas over a period of 15 years. After the signing of memoranda of understanding between the parties in May and June, Delek expects that the final gas sales agreements will be signed by the end of the year. BG has a facility in Idko and is in talks to buy gas from the Leviathan reservoir, and Union Penosa has a liquefaction facility in Damietta and is in talks to buy gas from the Tamar reservoir.
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""Under the rule of the Muslim Brotherhood, this was not possible, but since al-Sisi came to power, relations between Israel and Egypt have improved," Bloomberg notes. The background to the talks is the fact that BG and Union Panosa were unable to fulfill their obligations to their customers in international markets due to a shortage of gas in the domestic Egyptian market, and importing gas from Israel could benefit all three parties: Egyptian, Israeli, and international. From the Egyptian perspective, importing gas from Israel could meet the demands of the local market. Europe, for its part, wants to reduce its dependence on Russia, and Israeli gas that will be liquefied in a facility that already exists in Egypt could be a significant solution for them. In the Far East, on the other hand, gas is almost as expensive as oil, and importing from Israel could reduce their costs. What does this mean for the Israeli market? Gas exports to Egypt will bring a significant amount into the state's coffers every year. Beyond that, gas exports could significantly strengthen the relationship between Israel and Egypt.
Bloomberg adds that besides the option of exporting gas to Egypt, there are two other major options on the table. The first option is, of course, the option of building liquefaction facilities in Israeli territory, and the second is exporting gas to Turkey via a pipeline. Regarding the first option, Bloomberg quotes analyst Gil Bashan from IBI, who estimates that building a liquefaction facility in Israeli territory will take many years due to bureaucratic delays, while the second option (export to Turkey) is very complex from a political perspective, especially after Erdogan's statements against Israel following Operation Protective Edge.
Until 2012, it was Egypt that exported gas to Israel, but a series of attacks on the gas pipeline in Sinai and the rise to power of the Muslim Brotherhood turned the tables. Now it is Egypt's turn to import the gas, and the ball is in Israel's court, the American news agency concludes.
