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    Noble, INGL Sign Contract for Israeli Transmission

Summary

Pipeline exports to Egypt are on the cards.

by: Ya'acov Zalel

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Noble, INGL Sign Contract for Israeli Transmission

US Noble Energy and Delek Drilling, the two main players in the Israeli natural gas industry, have started conducting tests for gas transmission from Israel to North Sinai, Egypt, through the EMG pipeline.

If the tests, which should end by the end of the month, prove successful the companies would buy 37.5% in the pipeline and would become the pipeline operator in preparation of gas export from Israel to Egypt. Each of the two natural gas fields, Tamar and Leviathan, signed a 10-year gas deal with Dolphinus Holdings, worth $7.5bn each, according to filings to the Tel Aviv Stock Exchange.

Israel Natural Gas Lines (INGL), the operator of the Israeli natural gas grid said in a June 2 stock-exchange filing that it signed an interruptible agreement with Noble Energy to transmit gas to the EMG pipeline in Ashkelon. The company expects revenues of $63.5mn up to the end of 2022 for the overall transmission of 4.5bn m³.

That is less than expected but the Israeli natural gas authority has said that exports would be limited by the of capacity of the INGL infrastructure. It will be possible to transmit gas to EMG pipeline only when demand in the Israeli market is low enough, meaning at nighttime or weekends.

Eygpt is becoming self-sufficient in gas but it has idle liquefaction capacity.