(Oil Price) – Chevron and state-owned Israel Natural Gas Lines Ltd have signed an agreement to build a natural gas pipeline from Israel’s giant Leviathan gas field to Egypt, Leviathan project participant NewMed Energy has said.
Chevron’s unit Chevron Mediterranean Limited, the operator of the Leviathan Project, agreed with Israel Natural Gas Lines to provide transmission services for the flow of natural gas from the Leviathan reservoir to Egypt through the Nitzana Project.
The project is for onshore connection between the Israeli transmission system and the Egyptian transmission system in the Nitzana area, said NewMed Energy, which leads a partnership with a 45.34% in Leviathan.
The project includes the construction of a pipeline and a compressor station in the Ramat Hovav area in southern Israel and about 65 km of pipeline (40 miles) to the Nitzana border crossing.
The new pipeline will enable up to 600 million cubic feet per day to flow toward Egypt once the project comes on stream.
Chevron plans to raise Israeli pipeline gas deliveries and add more U.S. LNG into Egypt to cover surging demand, even as regional tensions persist.
“Egypt needs all the gas it can get,” said Freeman Shaheen, Chevron’s president for global gas, at the Gastech conference in Milan last week, per Bloomberg.
Egypt flipped back to LNG importing last year after domestic output fell, tightening its power balance and pushing it to tap more spot and term cargoes. New floating import terminals have come online, and 2025 LNG receipts have already doubled versus 2018 levels. Piped volumes from Israel have become a core pillar of supply.
Chevron operates Israel’s Leviathan and another offshore field that feed gas to Egypt. Leviathan was briefly shut during the Israel-Iran conflict for security reasons, but flows have resumed. In August, Israel and Egypt unveiled a long-term gas agreement worth roughly $35 billion—Israel’s largest to date—reinforcing Cairo’s import strategy.
By Michael Kern for Oilprice.com
