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Wednesday, 27 March 2019

Delek and its partners want to export even more gas to Egypt

Delek and its partners want to export even more gas to Egypt: Executives from Israel’s Delek Drilling is in talks to sell even more natural gas to Egypt beyond the USD 15 bn agreement signed last year with Alaa Arafa-led Dolphinus Holding, according to Bloomberg. Under the agreement, Delek and its partner Noble Energy should deliver 3.5 bcm from each of the Leviathan and Tamar gas fields for a combined total of 7 bcm. Delek, Noble, and Ratio Oil Exploration are now looking to supply up to 3 bcm per year above that to satisfy “an expected increase” in Egypt’s demand for gas. “The potential in the Egyptian market is endless. We’re going to clear up a lot of question marks in the coming months, once we start flowing gas through the [East Mediterranean Gas] pipeline,” CEO Yossi Abu said yesterday.

Biting off more than they can chew? Delek and its partners are still “scrambling” to sort out how they’re actually going to get all this gas into Egypt, Bloomberg notes. Their biggest current obstacle is “finding enough spare gas from the Tamar reservoir to test the pipe’s condition.” Earlier reports had suggested that the southern Israeli gas pipeline that is meant to carry gas from Tamar and Leviathan does not have the capacity for the contracted volumes. The status of the pipelines has pushed the timeline for Egypt to begin receiving the first shipments of Israeli gas to mid-2019, instead of this month. Egypt and Israel had begun talks in January over the construction of a new subsea pipeline that would enable Israeli gas to flow directly to Egypt’s Idku liquefaction plant, eliminating the need to expand Israel’s onshore infrastructure.

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