Israel Is Potential Gas Supplier for Europe as It Boosts Production
A future deal with Europe should involve other countries from the region, experts say
Israel is planning to boost its gas production and is seeking to reach gas supply agreements with European countries.
“The hope is to create a relatively fast working process and already during the summer to reach a framework agreement,” Lior Schillat, director-general of Israel’s Energy Ministry, said during a recent visit to the drillship of the Karish natural gas field, a new gas field in Israel’s territorial waters that is expected to start producing by the end of the year.
“At the beginning, it will be small amounts and slowly, as production and delivery capacities rise, it will increase,” he said.
Since the beginning of the Russo-Ukrainian War, the West has imposed multiple sanctions on Russia, including sanctions on the energy arena. As a result, Europe has faced energy security problems since Russia was its major energy supplier.
The situation has led many gas and oil producers to try to replace Russia as an energy supplier to Europe. Among them are many countries in the Middle East and North Africa.
The gas reserves in Israel are far beyond the current and expected consumption of gas in the country over the upcoming decades, Idan Liebes, energy policy researcher at the Samuel Neaman Institute for National Policy Research in Haifa, told The Media Line.
Additionally, Israel is already exporting around 5 billion cubic meters (bcm) a year to Egypt, and an additional 3 bcm to Jordan, although it has potential to export more.
Liebes added that right now, because of the situation in Russia, for Israel “there is a window of opportunity, and we don’t know how for how long this window will be open,” he said.
Dror Cohen, former senior advisor to Israel’s Minister of Energy, explains that Israel currently has three different natural gas operators.
“We have two different suppliers from three gas reservoirs and more to discover, for sure,” he told The Media Line.
“I believe that Tamar gas field, and Leviathan as well, will have more capacity in a couple of years. The other reservoir will be ready to produce soon,” he said.
Liebes explains that in order to start producing more natural gas, Israel needs first to look for new buyers.
“To have greater consumption, you need to have a market,” he said. He added that: “You have to have a buyer before you can provide the finance to develop the field, the extraction, the infrastructure and so on.”
If we export with our friends from the region, like Egypt and Cyprus, the more gas we have for local use, and the whole regional economy will prosper
Elad Golan, head of Regulatory Affairs and the person in charge of the petroleum unit at the Ministry of Energy, told The Media Line that work teams from the ministry and the European Union have been set up in order to check how Israel’s supply of gas to Europe could be enlarged.
“The teams are trying to consolidate drafts of agreements concerning future work,” he said.
Liebes noted an additional benefit that the increased production of gas could bring to the country.
“Once you do that, you have better energy security since you have more reserves,” he said.
He explained that when more gas fields are developed, there is a stronger infrastructure which provides better security for that local market.
Once the buyers are secured, Israel should explore options on how to get the natural resource to Europe. This is the main challenge, according to Golan.
Dror Cohen believes that the most optimal option is via pipelines and liquified natural gas (LNG).
“I believe those infrastructures will be effective for many years and the LNG ports will be active at least 25 years from now,” he said.
Liebes pointed out that exports from Israel are rather difficult.
He presented two possible ways to export gas to Europe.
The first one, he said, “is exporting via an underwater pipeline which would go from Israel’s territorial water to Cyprus and Greece, and then to the European pipeline.”
Liebes said that this would be essentially the longest underwater pipeline in the world. He added that it would be in very deep waters and that it is very costly and complicated technically.
The other pathway, he continued, “is to stream natural gas from Israel via pipeline to Egypt, then to liquefy it in one of the two liquification factories in Egypt, and from there send it by ship to Europe.”
Golan suggests the second option as the main one for the moment. He adds that additional options also are being explored.
Liebes noted that both pathways are essentially expensive, and that Russian gas is much cheaper. “It uses land pipelines, it’s closer to Europe, and the extraction itself is cheaper than the extraction of gas in Israel,” he said.
However, Cohen believes that an energy supply agreement between Israel and Europe is nearly inevitable.
“I believe nothing will stop it, but this is the Middle East, so I pray nothing will prevent it from happening,” he said.
A potential deal for Israel to supply gas to Europe should involve other countries from the region, noted Cohen.
“I think it’s important, it’s the right thing to do,” said Cohen. “If we export with our friends from the region, like Egypt and Cyprus, the more gas we have for local use, and the whole regional economy will prosper.”