Paving the way for the gas hub
We’re on track to receive 7 bcm of natural gas from Israel through new and improved pipelines in the EastMed: Chevron, Delek Drilling and Israel Natural Gas Lines (INGL) will spend USD 235 mn to lay a new subsea pipeline and upgrade existing lines, enabling the companies to ship 7 bcm of natural gas to Egypt each year, Bloomberg reports, citing a Delek statement. The new line will connect the Israeli coastal cities of Ashdod and Ashkelon, the latter of which is linked to Egypt via the EMG pipeline.
In details: The new pipeline is expected to cost USD 228 mn with the remainder being spent on expanding other lines, Delek said, without specifying which pipelines would receive investment. Delek and Chevron will pay for 56% of the new line, and INGL — which will build it — will cover the remaining 44%.
A year of imports: Egypt began importing gas from Israel’s offshore Tamar and Leviathan gas fields under the landmark USD 19.5 bn agreement in January last year. Delek and former operator Noble Energy were reportedly aiming to send 1.5-3 bcm Egypt’s way in 2020 before gradually increasing the supply to 4-5 bcm in 2021 and 7 bcm in 2022. The agreement will see Egypt import 85.3 bcm of gas between 2020 and 2034.
Chevron- The new company on the block: The US energy giant acquired Noble Energy for USD 5 bn last year, giving it a 39.7% stake in Leviathan and 32.5% of Tamar.