Exxon Mobil and Leviathan Reportedly Discussing Israeli FLNG
Exxon Mobil is in talks over the potential development of an LNG export terminal in Israel, Bloomberg reported on April 11.
Unnamed sources told the newswire that Exxon Mobil is in talks with the firms developing Israel’s Leviathan field over the possibility of developing a floating LNG (FLNG) unit. That would open up Leviathan’s export options and avoid the need to build expensive infrastructure to connect to LNG facilities in Egypt.
Israel’s Delek Drilling controls Leviathan alongside US partner Noble Energy, as well as another Israeli offshore field: Tamar. They have signed contracts in the eastern Mediterranean but are struggling to find export routes to Europe or further afield.
Meanwhile, Exxon recently made a major gas discovery in the neighbourhood. The Glaucus-1 well in Block 10 off Cyprus could contain up to 8 trillion ft³, the US major said in February
“It’s too early to comment on specific development and production timelines” for the Cyprus discovery, an Exxon spokesperson told Bloomberg.
The talks on an LNG terminal could suggest a change of tack in Israel after recent efforts to improve relations with Egypt to help open up options for exporting its gas.
Tel Aviv agreed in early April to waive a $1.3bn debt owed by Egypt over a cancelled gas contract. Leviathan signed multi-billion gas sales and purchase agreements with Egypt's Delphinus Holdings in 2018 that depended on cancelling the claim.
Tamar and Leviathan have also been looking to expand their export options. They are seeking to evade potential problems with pipeline capacity to Egypt, where they agreed 10-year contracts worth $15bn last year. Delek Drilling, the biggest shareholder in the Leviathan field, has been looking into several export options, including buying a stake in one of Egypt’s LNG sites.