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30 May, 2024
 
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Cyprus’ neighbor to add another lane for gas export

Leviathan partners in Israel to invest $568 million in third gas pipeline as demand grows

Source: Reuters

Partners in the Israeli offshore gas project Leviathan said on Sunday they would invest $568 million to build a third pipeline that will allow increased natural gas production and exports.

Leviathan, a deep-sea field with huge deposits, came online at the end of 2019 and produces 12 billion cubic metres (bcm) of gas per year for sale to Israel, Egypt and Jordan. The idea is to boost capacity to include sizeable volumes for Europe as it seeks to reduce dependence on Russian energy.

The new pipeline will connect the well with a production facility some 10 km off Israel's Mediterranean shore. It is due to come online in the second half of 2025, when production at Leviathan will jump to 14 bcm a year, the companies said.

'Expansion of production capacity and future liquefaction via a designated liquefaction facility will allow us to supply more natural gas to the local, regional, and very soon also the global market'

The Leviathan consortium includes operator Chevron (CVX.N) and Israel's NewMed Energy (NWMDp.TA) and Ratio Energies (RATIp.TA).

"Expansion of the production capacity and future liquefaction via a designated liquefaction facility will allow us to supply more natural gas to the local, regional, and very soon also the global market," said NewMed CEO Yossi Abu.

In the longer-term, Leviathan production is expected to reach about 21 bcm a year. The group has announced plans for a floating liquefied natural gas (LNG) terminal off the Israeli coast with an annual LNG capacity of about 4.6 million tons, or 6.5 bcm.

Ratio CEO Yigal Landau said that record demand from last year continued into the first quarter, and that there was room to expand use of the export network in Jordan as well.

"We are currently exploring the option of upgrading transmission infrastructures in Jordan to transport additional gas quantities to markets in Jordan and Egypt," Landau said.

Shares in Ratio were trading up 1.4% in Tel Aviv after the announcement, and NewMed shares were up 0.7%.

TAGS
Cyprus  |  Israel  |  Egypt  |  Jordan  |  energy  |  Leviathan  |  natural gas  |  LNG

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