Energy Firms Near Deal to Sell Israeli Gas into Jordan
A drilling consortium developing Israeli offshore natural-gas fields is closing in on a politically sensitive deal to supply gas to Jordan, according to people familiar with the situation—moving the Jewish state a step closer to exporting energy for the first time in its history.
Israel's Delek Group Ltd. and Texas-based Noble Energy Inc., which are developing fields offshore Israel, are discussing a gas supply deal with Arab Potash Co., a fertilizer company with a plant in Jordan, according to these people. The deal would involve extending a gas pipeline from an Israeli chemical plant to APC, located across the Dead Sea in Jordan. An Israeli official familiar with the talks said a deal could be just weeks away.
While relatively small in terms of commercial value, the deal could open a major economic link between the neighboring countries and provide a springboard for a much bigger supply arrangement between Israel and Jordan. For Israel it would carry outsize symbolic significance. Since its founding decades ago, Israel has struggled with a lack of energy reserves in a region full of energy-rich and hostile neighbors.
(snip)
Energy companies in recent years have announced two major discoveries off the Israeli Mediterranean coast, estimated to hold at least 650 billion cubic meters of gas. That is enough, in theory, to satisfy Israeli energy demands for decades, while leaving a surplus to export. Development of the resources will take years, and could ultimately prove less bountiful than forecast. Still, gas from one of the finds, the Tamar field, started flowing to Israeli plants earlier this year.
Jordan, also with few energy sources of its own, has long relied on neighbors for imports, and is currently seeking cheap supplies to help make up for lost gas imports from Egypt. Egyptian supplies have become erratic because of attacks on a key pipeline amid the chaotic aftermath of the fall of the Hosni Mubarak government.
More..
http://online.wsj.com/news/articles/SB10001424052702303932504579256352641300102