Israel’s Ministry of Energy and Infrastructure has approved a new natural gas export to land that connects the industrial area of Hovav herd in the Nene Desert region in the Nitzana border with Egypt. The $ 610 million project, which will be built and operated by Israel Natural Gas Lines, will extend Israel’s export capacity at 6 billion Cu m (BCM) annually, equal to about 600 million feet daily.
Newmed Energy, the Israeli exploration firm, which has a 45% participation in the Gas field outside the Leviatà in the Mediterranean Sea, states in the regulatory archives that the Nitzana project consists of a 36 inches, 67 km and a new compressor station at Ramat Hovav.
Chevron Mediterranean Ltd., Leviathan operator with an interest of about 40%, has committed to an EPC contract with English for the compressor, with a value of $ 285 million.
The presentation states that Leviathan’s partners, which include Newmed Energy and Ratio Oil Corp., based on Israel, will cover any budget expenditure, with Chevron who estimates excessive potential costs of $ 65 million.
By virtue of the transmission agreement, Leviathan’s members have firm rights guaranteed about a third of the pipeline’s capacity, with the option of expanding 100% if other fields do not exercise rights.
The natural gas authority established assignments of the daily company to approximately 140,000 MMBTU for Leviathan in a fee of one third, with 70% of each assignment classified as a transmission of companies and 30% as interrupted.
The term of the contract is 15 years since the beginning of the flows, with an extension option of five years. Flows must begin in the 36 months after the preceding conditions. The terms of payment require that 40% of the costs of the project be paid once the conditions are satisfied, with the remaining 60% linked to the construction milestones. The agreement also includes a completion clause that allows Chevron to leave if exports to Egypt fall by 90% or more for reasons outside their control, with the possible reinstatement if the flows are resumed.
Construction is scheduled to begin by the end of 2025 with the planned commissioning in 2028. Once operational, the pipeline will increase the export capacity of total gas from Israel in Egypt to more than 2.2 billion feet daily, supporting the export contracts of $ 35 million from Leviathan until 2040.
Diversity of additional supply is expected. Energean told investors that he would reserve the capacity of the Gas Nitzana line from his Katlan field, scheduled for the first production in 2027, adding up to 2 BCM a year to the cross -border flows.
Egypt reinforces its parallel reception system. The Oil Ministry has confirmed that a second floating storage and regasification unit with 750 million feet of feet per day will begin service at Ain Sokhna in the second half of 2025.
The Mostafa Prime Minister Madbouli inspected the port works in June for the ESKIMO FSRU Energy, which is being integrated into the Suez de Suez de Suez terminal.
Egypt has also worked to politically frame the expansion. Madbouli said that the $ 35 million supply agreement represents an extension of its 2019 import pact with Israel, not a totally new contract, a clarification aimed at managing household sensitivities.
Policy analysts notice the bets: the Institute for National Security Studies of Tel Aviv has reported that the gas now constitutes approximately 86% of the trade between Israel and Egypt, and that the Egyptian energy crisis of 2024 “emphasized the importance of Israel as a natural gas provider”.
The Middle East economic survey has warned that disputes on volume allocation and cost distribution in the Nitzana project “threatens with future gas flows”.
With existing approvals, the funding, the EPC contracts signed and Egypt extending their downstream system, the Nitzana pipeline is placed as the critical corridor on the coast to deliver volumes of Israeli gas hired in Egypt for the next decade.
