Israel Approves $37 Billion Deal to Deliver Gas to Egypt
On Wednesday, Israeli Prime Minister Benjamin Netanyahu announced the approval of what he described as the “largest gas deal” in Israel’s history, providing an export permit for a $37 billion agreement that allows Chevron and other energy firms to significantly enhance gas shipments to Egypt. Mr. Netanyahu hailed the deal, stating that it would strengthen Israel’s regional standing, generate approximately $18 billion in taxes and other revenue over time, and help keep energy prices manageable for consumers in Israel. “This deal greatly bolsters Israel’s role as a regional energy powerhouse and contributes to stability in our region,” he expressed in a statement. Despite the excitement surrounding the announcement, some analysts noted that it came unusually late, months after the initial agreement was reached and disclosed. In August, the stakeholders of the Leviathan gas field, chiefly the Israeli company NewMed Energy and the American firm Chevron, indicated they had forged an agreement with Egypt to notably increase and extend a previous arrangement made in 2019. However, the deal could not be finalized unless Israel issued the necessary export permit, with a spokesperson for NewMed Energy stating on Wednesday that the approval was the final hurdle. The companies’ choice to declare their agreement with Egypt in the summer, prior to Israel’s finalization of the export permit terms, was considered unusual and likely reflected the complexities of conducting international commerce in the area amid the conflict in Gaza, according to some analysts. Both Israel and Egypt control access to the conflict-ridden region, and the Trump administration, which brokered a cease-fire in Gaza with the assistance of Egypt in October, regards both nations as vital to maintaining stability and furthering President Trump’s vision for peace and prosperity in the Middle East. In typical circumstances, Gabriel Mitchell Mitvin, an energy analyst in Israel and a visiting fellow at the German Marshall Fund, pointed out that companies and nations whose collaboration is needed for such agreements typically announce their deals simultaneously. The staggered announcements in this case are described as “a little abnormal” by him, suggesting that there may have been disagreements between the companies and Israel. “Chevron is accustomed to having its way,” Mr. Mitvin remarked, indicating that the firm might have been attempting to play “hardball” by making the announcement in August before Israel was ready to grant the permit. He added, “Trump needed it to get done.” Israel encountered diplomatic pressure, including from the Trump administration, to finalize the agreement. When Israel’s energy minister, Eli Cohen, declined the export permit in October, his American counterpart, Energy Secretary Chris Wright, canceled a planned visit to Israel for the following month. However, Israeli officials characterized the delay as a negotiation tactic that ultimately secured better terms. Following Mr. Wright’s cancellation in October, Mr. Cohen’s office asserted that the deal would not be approved until fair pricing was agreed upon. When announcing the deal on Wednesday, Israel’s Energy and Infrastructure Ministry stated that the approval had been granted “following protracted negotiations” that resulted in “significant achievements in price stability, competitive promotion, and energy security.” Gas plays a crucial role in Israel’s economy, typically making up roughly 70 percent of electricity generation. Israel exports its surplus gas primarily to Egypt and Jordan, although Egypt is the main buyer. Gas sales are a fundamental part of the relationship between the two nations. Cairo utilizes the imported fuel from Israel for electricity generation and industrial operations, while also exporting some to Europe and other markets via two liquefied natural gas terminals located along its Mediterranean coast. Chevron, now a key player in Israel’s energy sector, aims to leverage its position in Israel, Egypt, and Cyprus as a regional launchpad to emerge as a significant exporter to Europe. The deal confirmed on Wednesday holds economic importance for Israel, will assist in fulfilling Egypt’s energy requirements, and comes at a “moment that is crucial,” considering the uncertainties surrounding the situation in Gaza, Mr. Mitvin remarked. “The approval of this gas agreement signifies a historic occasion for the state of Israel, both in terms of security-diplomatic implications and economic ramifications,” stated Mr. Cohen, the Israeli energy minister. Stanley Reed contributed reporting.
Published: 2025-12-18 09:19:00
source: www.nytimes.com
