Israel and Cyprus are currently in advanced talks to potentially seal a $1.5 billion agreement for the supply of natural gas, according to a report from S&P Global. The deal, which involves exporting gas from Israel to Cyprus via pipeline, could mark Israel’s first natural gas sale to Europe.
The proposed contract would span over a decade and involve gas from the Karish and Tanin fields, operated by the energy company Energean. These fields are located off the coast of Israel, and the gas is currently produced at the Energean Power Floating Production Storage and Offloading (FPSO) facility. The FPSO has an annual production capacity of 8 billion cubic meters, which primarily serves the Israeli market.
According to a representative from Israel’s Ministry of Energy, the discussions center on areas of shared interest and reflect the strong ties between the two nations. Energean has already applied for an export license to Cyprus and plans to use a dedicated pipeline for the gas transportation.
As Europe’s demand for natural gas continues to grow, the price for gas remains around €40 per megawatt-hour (roughly $44/MWh). This proposed agreement could help both countries capitalize on Europe’s increasing energy needs, particularly as Israel continues to ramp up its natural gas production.
In 2023, Israel’s natural gas production reached an all-time high of 24.7 billion cubic meters, with the Karish field, which began operations in October 2022, contributing significantly to this output. Other major gas fields like Leviathan and Tamar have been in operation since 2019 and 2013, respectively. Although the Tamar platform was temporarily shut down due to safety concerns following recent Hamas attacks, Israel remains a key gas supplier to neighboring countries like Egypt and Jordan.
Source: knews