Israel signs mega deal with Jordan to supply natural gas – Israel to become major player in world gas market

Gas field (illustrative)Gas field (illustrative)

Israel has signed an agreement with Jordan which foresees the supply of $15 billion (11,4 billion euros) worth of natural gas from its Leviathan energy field over 15 years.

Israeli Energy and Watere Minister Silvan Shalom, who still needs to approve the memorandum of understanding, hailed the agreement, and referred to it as “a historic act that will strengthen the economic and diplomatic ties between Israel and Jordan.”

“At this time, Israel is becoming an energy superpower, which will supply the energy needs of its neighbors and strengthen its standing as a central source of energy supply in the region, and I welcome it,” the minister said.

According to the Israeli media, Jordan turned to Israel because their supply of natural gas from Egypt had been halted by repeated terrorist attacks on the gas pipeline from Egypt.

The new deal is the largest collaboration with Jordan to date. It will make Israel its chief supplier.

In March 2013, Israel began pumping natural gas from the Tamar deposit — discovered in 2009 and located some 90 kilometers (56 miles) west of Haifa — which holds an estimated 8.5 trillion cubic feet of natural gas.

In addition to Tamar, in 2010 an even larger deposit, Leviathan — which boasts an estimated 16-18 trillion cubic feet of gas — was discovered 130 kilometers (81 miles) west of Haifa. It is expected to become operational in 2016.

The finds are expected to transformé Israel from an energy importer to a major world player in the gas market.

Israel decided last year to export 40 percent of the country’s offshore gas finds, and has since signed a 20-year, $1.2 billion deal with a Palestinian firm, and in June signed a letter of intent to supply energy to an Egyptian facility as well.