Israel Signs Record $35 Billion Natural Gas Deal with Egypt Through 2040
Partners in Israel’s Leviathan offshore gas field have signed a landmark $35 billion agreement to export natural gas to Egypt through 2040—marking the largest energy export deal in the country’s history.
Under the deal, about 130 billion cubic meters (BCM) of natural gas will be supplied to Egypt, either until 2040 or until the contracted quantities are delivered in full. The gas will be sold by the Leviathan consortium, which includes NewMed Energy (formerly Delek Drilling and part of Yitzhak Tshuva’s Delek Group), holding a 45.3% stake in the field off Israel’s Mediterranean coast.
Leviathan, among the world’s largest deep-water gas discoveries, began supplying the Israeli market in late 2019 and started exporting gas to Egypt in January 2020. The new agreement significantly expands that arrangement—tripling previous export volumes—and covers around 22% of Leviathan’s capacity and 13% of Israel’s total gas reserves.
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According to NewMed, the deal is expected to fuel further development of the Leviathan project and ensure continued domestic gas supply well into the 2060s. The company described the agreement as a pivotal move for regional energy strategy, noting that natural gas has become a key instrument for shaping the area’s geopolitical landscape.
The gas will be delivered via Blue Ocean Energy, with the initial 20 BCM scheduled to begin flowing in the first half of 2026. The remaining 110 BCM will follow once production capacity is expanded. While the agreement is still subject to final regulatory approval, Israel’s Energy Ministry has already signaled its support for volumes up to 145 BCM, and NewMed expressed confidence that formal clearance will be granted.
To support the deal, two infrastructure projects are planned: a new pipeline from the Leviathan reservoir to its production platform, boosting annual capacity from 12 to over 14 BCM; and an upgrade to the Ashkelon-Ashdod pipeline to increase flow to Egypt by 2 BCM annually.
NewMed projects that Leviathan’s total annual capacity will rise to 23 BCM in the coming years. In 2024, the field produced 11 BCM, half of which was exported to Egypt, with the remainder split between Israel and Jordan. By 2035, about 60% of Leviathan’s output is expected to be exported, with 40% reserved for domestic use.
The company emphasized that the planned expansion will prioritize Israel’s energy needs in the 2040s and beyond, ensuring sufficient supply for the country’s growing gas-fired power sector and broader economic demands.
