Pipeline carried gas from Egypt to Israel for several years until saboteurs began thwarting the flow through Sinai pipeline explosions.
Turning the tables on the region’s natural resource flow, Israeli gas may soon surge southward through the Egyptian pipeline that for several years provided gas to Israel – but fell victim to saboteurs in Sinai.
The developers of the 282-billion cubic meter Tamar reservoir, which has been supplying gas to Israelis since March 2013, have signed a letter of intent to sell 2.5 b.cu.m. annually to the Egyptian firm Dolphinus Holdings Limited, the Delek Group reported to the Tel Aviv Stock Exchange on Sunday morning. This gas surplus sold to the Egyptian firm from Israel’s local supply will begin serving private industrial consumers already in 2015, according to the partners.
The move looks to revitalize Egypt’s East Mediterranean Gas Company pipeline that for several years carried gas from Egypt to Israel. In 2008, EMG began supplying Israel with about 40 percent of its natural gas provisions, until saboteurs began thwarting the flow through Sinai pipeline explosions. Following 14 months of such attacks, the Egyptian government formally terminated the agreement between EMG and Israel in April 2012.
At Tamar, located about 80 km. west of Haifa, Noble Energy holds 36% of the basin. Delek Drilling and Avner Oil Exploration each own 15.625%, while Isramco owns 28.75% and Dor Gas owns 4%.
The neighboring 621-b.cu.m. Leviathan gas reservoir, about 130 km. west of Haifa, is expected to begin flowing in 2017. Noble Energy owns 39.66% of Leviathan, while Delek Drilling and Avner Oil – both subsidiaries of the Delek Group – each own 22.67% and Ratio Oil Exploration holds 15%.
The realization of the project will help maximize the production capabilities from the Tamar reservoir, and will strengthen the Israeli economy by increasing tax and royalty revenues, said Delek Drilling CEO Yossi Abu.
Sunday’s announcement joins a number of other regional agreements and understandings that the Tamar and Leviathan partners have signed with Israel’s neighbors.
In September, the Leviathan reservoir partners signed a letter of intent to sell 45 b.cu.m. of natural gas to Jordan’s National Electric Power Company over a 15-year period.
Empty liquefaction plants in Egypt have become an attractive option for Israeli gas. The British Gas Group signed a letter of intent with the Leviathan partners for the 15-year supply of 105 b.cu.m. of natural gas to its Idku plant.
Meanwhile, in early May, the Tamar reservoir partners signed a letter of intent with Spanish firm Unión Fenosa, for the provision of 71 b.cu.m. to that firm’s liquefaction facility in Damietta.
In January, the Leviathan partners signed their first export deal – a $1.2b. sales agreement with the Palestine Power Generation Company.
According to the agreement, PPGC is set to buy around 4.75 b.cu.m. of gas over 20 years, to fuel a future 200-megawatt power plant in Jenin.
A month later, the Tamar reservoir partners signed a $500 million deal to provide 1.8 b.cu.m. of gas to the Jordanian firms Arab Potash and Jordan Bromine, to power their Dead Sea facilities for the next 15 years, beginning in 2016.
As far as Sunday’s letter of intent signed with Dolphinus is concerned, this latest deal is “another important link in a sequence of agreements that will enable the supply of natural gas to the domestic market in Egypt,” said chairman of Delek Drilling and CEO of Avner Oil Exploration Gideon Tadmor.
“I have no doubt that these are agreements that will strengthen the relations between Israel and its neighbors,” Tadmor said.
http://www.jpost.com/Israel-News/New-Tech/Israeli-gas-firm-signs-bid-to-sell-natural-gas-to-Egypt-379181
YNET Gas pipeline between Israel, Egypt to resume activity
Israel signs deal with Egyptian company to supply a minimum of 5 million cubic meters of natural gas over the next three years.
Avital Lahav 10.19.14
A deal signed between the Israeli Tamar gas reservoir and Egyptian company Dolphinus Holdings will soon bring to the resumption of natural gas flow Israel and Egypt. The gas flow from Egypt to Israel was halted two and a half years ago, after terror organizations operating in the Sinai Peninsula repeatedly targeted the pipe with explosives.
Since then, the Tamar reservoir started operating and the signed agreement includes the export of up to 2.5 billion cubic meters of natural gas surplus from Israel to private industrial customers in Egypt.
The supply of gas will be on a regular basis, and will be supplied after meeting the needs of Israeli customers, but the partners agreed to supply a minimum of five million cubic meters over three years.
This deal joins contracts other companies sharing Israel’s gas reservoirs have signed with Middle Eastern clients, including the Palestinian Authority, as well as to agreements to sell Israeli gas to the liquefaction plants of Union Fenosa and British Gas in Egypt, and an agreement with the Jordanian National Electric Power Company.
The deal was signed thanks to the apparent improvement of the Egyptian military control of Sinai and the decrease in terrorist activity in the peninsula.
The improvement in security alongside the fact that the pipeline is already built and there is no need to invest money in its construction, made the agreement worthwhile despite the still-existing risk the pipeline will be a target for terrorist attacks.
http://www.ynetnews.com/articles/0,7340,L-4581632,00.html