TEMPO.CO, Jakarta - Israel has signed its largest export agreement to send natural gas to Egypt, even as Cairo voices growing anger over Israel's genocide in Gaza. The deal will deepen Egypt's energy dependence on Israel amid increasing public outrage over its alleged involvement in the Gaza blockade.
The agreement, as reported by The New Arab, was announced on Thursday by NewMed Energy, one of the three co-owners of Israel's Leviathan gas field. The deal will allow Israel to export up to US$35 billion worth of natural gas to Egypt until 2040, with a 14 percent increase in import prices.
This import for Egypt is nearly three times its import of gas from Israel's Leviathan gas field and marks the largest export deal in Israel's history.
NewMed is one of the three co-owners of the field, along with Israeli company Ratio and US-based Chevron. NewMed holds 45.34 percent of the gas reserves.
Egypt, heavily reliant on Israeli gas for domestic needs, has been struggling with an energy crisis in recent years. Its natural gas supply has been far below demand, forcing Cairo to spend billions of dollars on liquefied natural gas (LNG) imports.
Egypt's significant energy gap over the past two summers has led to rolling blackouts amid soaring temperatures, sparking public anger.
The government has been trying to bridge the gap by increasing LNG imports, projected to surge to US$19 billion this year, up from US$12 billion in 2024.
Israel's gas currently accounts for about 15-20 percent of Egypt's consumption, according to the Joint Organisations Data Initiative.
This marks a significant expansion from the deal reached between Egypt and Israel in 2018, which sent 4.5 billion cubic meters of gas to Egypt annually, despite Israel repeatedly halting its supplies since its attacks on Gaza began in October 2023. The current agreement will expire by the end of this decade.
The Leviathan field, located off Israel's northern coast, resumed operations in late June after a temporary closure during Israel's 12-day air war with Iran. The field also supplies gas to Jordan.
Based on the new agreement, Leviathan will deliver about 130 billion cubic meters (bcm) of gas to Egypt. The first phase will involve exporting 20 bcm of gas starting early next year, once additional pipelines have been installed. The remaining 110 bcm will follow after the expansion of Leviathan and the construction of a new transmission pipeline through Nitzana.
"It's much, much, much, much better, like dramatically better, than any LNG alternative, and it will save billions of dollars to the Egyptian economy," said NewMed CEO Yossi Abu.
Transporting gas via pipeline is much cheaper than shipping LNG, making the deal financially attractive for Egypt despite heightened political tensions.
Cairo has become increasingly critical of Israel's genocide in Gaza, where over 61,250 people perished during the 22-month war. Almost 200 Palestinians died of starvation, half of them children, as Israeli forces continued to block food aid at the Rafah border, despite the supplies waiting in Egyptian territory for weeks.
Egypt, along with Qatar and the United States, has played a central role in brokering a ceasefire between Israel and Hamas. However, international frustration is mounting due to Israel's military expansion and aid blockade.
Despite the pressure, Egypt remains committed to its economic and energy ties with Israel, continuing to pursue deals that serve its domestic needs. Nonetheless, public opinion and internal political rhetoric are becoming more hostile regarding the LNG shipments, making the deal financially appealing for Egypt despite heightened political tensions.
However, according to Mada Masr as cited by Middle East Monitor, based on the new deal, Egypt will pay approximately $35 million more per bcm, which is a 14.8 percent increase from the previous agreement.
A former official at Egypt's Ministry of Petroleum and a government source told Mada Masr last year that the two countries had been in negotiations for months to increase the flow of Israeli gas to Egypt.
They said Egypt is likely to agree to pay higher import prices because Israeli gas is the cheapest alternative to address supply shortages.
No Guarantee of Fulfillment
However, the Implementation of this agreement hinges on the completion of the pipeline and additional export infrastructure.
The first phase of this agreement, which will channel 20 billion cubic meters of gas to Egypt in early 2026, depends on the completion of new pipeline construction to the Leviathan reservoir and the expansion of the pipeline network connecting the Israeli port cities of Ashdod and Ashkelon, a project that has been stalled due to Israel's genocide in Gaza.
The second phase, which will deliver the remaining 110 bcm of gas to Egypt, relies on the expansion of export infrastructure, including the construction of a new overland pipeline from Israel to the Egyptian border at Nitzana has not yet begun.
A notice issued by NewMed on Thursday cautioned that there is "no guarantee" that these requirements will be met.
This move comes amid growing public anger in Egypt over Cairo's alleged involvement in the Israeli blockade in Gaza, where almost 200 Palestinians have died from the starvation imposed by Israel.
In July, two men who stormed the Ma'asara police station in Cairo in protest of Egypt's failure to open the Rafah crossing to Gaza, allowing aid to enter the territory, were forcibly disappeared.
This came shortly after a wave of protests outside the Egyptian embassy in the European capital, sparked by activist Anas Habib in the Netherlands, who symbolically locked the embassy gates to protest the closure of Rafah.
Egyptian President Abdel Fattah el-Sisi has denied these accusations. During a summit in Cairo this week, he criticized the "lack of values in the international community's handling of the crisis" and dismissed allegations of Egypt's involvement in Israel's ongoing attacks in Gaza, which have killed over 61,250 Palestinians, as "nonsense."
Editor's Choice: Germany Halts Military Exports Potentially Usable by Israel in Gaza
Click here to get the latest news updates from Tempo on Google News
