Israel Delays $35 Billion Gas Deal with Egypt... Qatar Offers Alternatives

SadaNews Economy Translation - The massive gas deal between Egypt and the Israeli company "Leviathan", valued at $35 billion, is experiencing a standstill after the Israeli Energy Ministry postponed the final export approval. This delay has opened the door for Qatar to try to persuade Cairo to purchase liquefied natural gas from it in large quantities, according to the Israeli economic newspaper "Globes", citing senior Egyptian and Israeli officials, as translated by SadaNews.

Deal Details

The deal was signed last August, aiming to finance the expansion of production at the "Leviathan" field and establish a new pipeline to Egypt via Nitzana.

The approval was supposed to be obtained within two months, but the Israeli Energy Ministry postponed the decision due to new demands, the most prominent of which were extending the export period beyond 2040 and allocating a portion of the gas for the local market at lower prices.

Qatari Move

Qatar has offered Egypt to supply it with liquefied gas in massive quantities, at a time when Israeli Prime Minister Benjamin Netanyahu and Energy Minister Eli Cohen are lagging in finalizing the file.

An Israeli official warned that Qatar could become the supplier of about 20% of Egypt's electricity, which could diminish Israel's strategic importance, as translated by SadaNews.

Meanwhile, an Egyptian official confirmed that Cairo does not consider Israel as an "enemy or a friend", but rather a business partner, pointing to alternatives such as Qatar and the United States.

Egyptian Position

According to the Hebrew report, "President Abdel Fattah el-Sisi is hesitant to deal with Qatar due to the association of its Emir, Tamim bin Hamad, with the Muslim Brotherhood, which he considers a domestic threat".

Egypt recently signed a liquefied gas agreement with an American company worth $4 billion, but it does not cover the large quantities supplied by the "Leviathan" field (130 billion cubic meters).

The administration of President Donald Trump intervened to try to solve the crisis, with the participation of the American ambassador in Tel Aviv and Energy Secretary Chris Wright.

The American company "Chevron", which owns about 40% of the field, is facing internal pressures to reconsider its investments, given that it has larger assets in the United States, Kazakhstan, and Australia.

Energy Crisis in Egypt

Egypt is suffering from a significant gap between production and consumption: production peaked in 2021 at 71 billion cubic meters.

It later declined by 14% annually to reach 45 billion cubic meters in 2024.

Annual consumption is nearing 70 billion cubic meters, placing the Egyptian system in front of challenging realities.

Israeli Dimensions

The deal aims to finance infrastructure projects to increase the production of "Leviathan" from 12 to 21 billion cubic meters annually.

Partnership companies, including "NewMed" and "Ratio Oil", have invested hundreds of millions in the second phase of the field's development.

There are also disputes over gas prices between the Israeli Electric Company and the "Tamar" reservoir, reaching arbitration in a court in London.

The Israeli Energy Ministry confirmed the continuation of dialogue to find solutions that meet local market needs and allow for export, while no comment has been issued from Netanyahu's office.