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Tuesday, 7 February 2017

Natural gas from East Med could supply Europe if disputes are resolved

Natural gas reserves in the East Mediterranean can fuel Europe, David Wainer writes in an evergreen story for Bloomberg. Looking at gas from Egypt, Cyprus, and Israel, Wainer writes: “hundreds of miles of undersea pipelines will cost [bns of USD] and pose a technical challenge for their designers. And even that task is dwarfed by the political engineering required to build stable energy routes through a conflict-ridden region.” Amos Hochstein, the former US energy envoy to the region says: “This is the kind of opportunity where either everybody rises or everybody falls.” Eni’s CEO Claudio Descalzi shares the view and sees Egypt as the center of a hub including Israel, Cyprus and Libya that can provide “solutions for European energy security.” Former US diplomat Matthew Bryza sees potential to replicate in the region the success achieved with BP’s Baku-Ceyhan oil pipeline runs from Azerbaijan via Georgia to Turkey’s Mediterranean coast.

Elsewhere, Bloomberg’s Salma El Wardany reports that Egypt plans to import between 100 and 108 LNG shipments in 2017. According to sources close to the matter, the country might phase out imports in 2018 as BP’s North Alexandria concession and Eni’s Zohr field begin production this year ahead of exporting in 2019. As we noted earlier this week, 43 to 45 shipments of LNG will be imported between March and December this year from Oman, Russia’s Rosneft, and France’s Engie, with a tender in November for the remaining shipments.

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