Page 5 - AfrOil Week 47 2022

AfrOil COMMENTARY AfrOil

Within the last few weeks, though, there have co-operation with NewMed would focus on
been indications that Israel does not necessarily piping Israeli production to Egypt and on mak-
view Egypt as the only possible route to Europe. ing use of existing gas liquefaction plants. It also
indicated that the partners had yet to decide
NewMed, Uniper sign MoU whether to install a new-build FLNG in Israeli
In early November, NewMed Energy – the com- waters further down the road or continue mak-
pany formerly known as Delek Drilling that ing use of the Idku and Damietta LNG plants.
serves as majority shareholder in and operator Since then, however, NewMed has offered
of Leviathan, Israel’s largest offshore gas field – some hints about its own preferences. Abu said
signed a non-binding MoU with Uniper, a Ger- during a conference call discussing his compa-
man company. In a statement, Uniper explained ny’s third-quarter results on November 24 that Israel does not
that the parties were exploring several different NewMed was “really keen” to develop an FLNG
avenues of co-operation, including “collaborat- solution for Leviathan and wanted to start work necessarily view
ing on the supply of LNG in the short and long “very soon” on a pre-front end engineering and
term and producing blue and green hydrogen.” design (FEED) study. The goal is to make a final Egypt as the only
In the near future, the statement said, the investment decision (FID) on expanding Levi-
companies will “look into the supply of natural athan’s production capacity from 12bn cubic possile route for
gas from Israel to Germany in the immediate metres per year to 14 bcm per year “as soon as gas exports to
term using existing production and transmis- we can,” he declared.
sion infrastructure in line with the availability Abu clarified his statements in a conversation Europe
of the transmission pipeline between Israel and with Reuters later on November 24, saying that
Egypt, where the natural gas will be delivered to NewMed wanted to take an FID in early 2023.
LNG facilities, and from there to Germany.” He also described the FLNG plan for gas exports
Additionally, Uniper said, the partners will beyond the near term as “really where we are
consider a plan for using Israeli gas to boost LNG heading right now.”
exports to Germany. This would involve the In other words, NewMed does appear to be
expansion of existing Phase 1B infrastructure looking beyond Egypt with respect to export
at the Leviathan field and sending additional routes for Israeli gas. It will probably take sev-
volumes of gas either to the Idku and Damietta eral years to build the FLNG needed to imple-
LNG plants in Egypt or to a new-build floating ment such a solution – and certainly in the near
LNG (FLNG) facility that would be installed in term, it appears to anticipate working more with
Israel, it explained. Egypt, as well as another of Israel’s neighbours.
The statement also said that the partners also (“In 2023 we will significantly speed up Levia-
envisioned future co-operation in the area of than’s expansion and entry into new markets,
hydrogen fuel. “In line with NewMed Energy’s while strengthening the collaboration with our
strategic plan, according to which the partner- customers in Israel, Egypt and Jordan,” Abu told
ship is aimed at promoting green energy, the Reuters.)
MoU also includes potential collaboration in Once the FLNG is in place, however, Israel
the field of blue hydrogen and green hydrogen will have another option for sending gas to
and its transportation from Israel to Europe,” it Europe. It will probably still need to collaborate
noted. with Egypt due to capacity constraints, but it will
Niek den Hollander, Uniper’s CCO, empha- gain flexibility through diversification. ™
sised the environmental benefits of the deal, say-
ing: “This collaboration with NewMed Energy
fits our strategy of diversifying our gas supply
sources and paving the way to a decarbonised
world. Sourcing natural gas from offshore Israel
has the potential to increase security of supply
for Germany.”
Meanwhile, Yossi Abu, the CEO of NewMed,
stressed the importance of gas to energy markets
in Europe and other regions. “For the foreseea-
ble future, natural gas will be the most signifi-
cant energy source in the world,” he remarked.
“NewMed Energy is continuing to promote its
international activity. Leviathan is an energy
anchor in the Middle East, supplying energy to
Israel and other countries in the region, while
also being able to help in the energy crisis in
Europe.”

NewMed leaning toward FLNG?
Uniper’s announcement does not seem to be a
sign of immediate changes in the pipeline for
Israel’s largest gas field.
After all, the German company did say in
early November that its short-term plans for Uniper and NewMed will first use existing infrastructure (Photo: NewMed Energy)

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