Israel-Egypt to begin gas deliveries, part of 'most significant' economic agreement in their history
Israel-Egypt to begin gas deliveries, part of 'most significant' economic agreement in their history
Egypt and Israel's $15 billion export agreement has been hailed by Israeli officials as the most significant deal between the two sides since they made peace in 1979.
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Israeli exports to Egypt were expected to reach 7 billion cubic meters a year [AFP/Getty]
Israel will begin exporting natural gas to Egypt in November, Reuters reported quoting a statement by the Israel Energy Minister Yuval Steinitz.
The deliveries will mark the start of a $15 billion export agreement between Israel's Delek Drilling and an Egyptian counterpart.
Israeli officials have called it the most significant deal to be signed between the two countries since they normalised relations in 1979.
Steinitz told reporters at a gas forum in Cairo on Thursday that the testing of the pipeline from Israel to Egypt had been finished.
Gas will be brought from Israeli offshore fields Tamar and Leviathan into Egypt's national gas grid.
Israeli exports to Egypt were expected to reach 7 billion cubic metres a year across 10 years, Reuters reported, and will be split evenly between Egypt's domestic market and re-export.
Egypt is looking to become a key international trading and distribution centre for gas. It is helped by its strategic location on the eastern Mediterranean.
It, along with Cyprus, Israel and Italy, are working together to bring more natural gas to Europe.
Seven energy ministers, including those from Israel, Egypt, Cyprus, Greece, Jordan, Italy and the occupied Palestinian Territories came together in January for a meeting in Cairo to mark the launch of the East Mediterranean Gas Forum
The launch of the gas forum excluded Turkey and Lebanon - despite both carrying out exploratory drilling in the eastern Mediterranean last year.
Their claims to the Eastern Mediterranean waters have been challenged - Turkey's by Cyprus and Lebanon's by Israel.
Last week, Egypt announced it will pay a $500 million settlement to Israel's state-owned electric corporation in compensation for losses that occurred after Cairo abruptly cut supplies of natural gas to Israel in 2012.
Israel had previously relied on Egypt for roughly 40 percent of its gas needs.
Egypt and Jordan are the only Arab countries to have officially recognised Israel.
Agencies contributed to this report.
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