July 25, 2019 / 4:48 PM / 5 months ago

CORRECTED-UPDATE 1-Israel to start exporting natural gas to Egypt in November - minister

(Corrects unit in the first paragraph to metres, not feet)

CAIRO, July 25 (Reuters) - Israel will begin exporting natural gas to Egypt in November, with volumes eventually set to reach seven billion cubic metres per year, Israeli Energy Minister Yuval Steinitz told reporters in Cairo on Thursday.

The supplies will mark the start of a $15 billion export agreement between Israel’s Delek Drilling and U.S.-based partner Noble Energy with an Egyptian counterpart in what Israeli officials called the most significant deal to emerge since the neighbours made peace in 1979.

The deal signed early last year will bring natural gas from Israeli offshore fields Tamar and Leviathan into the Egyptian gas grid.

Testing of the gas pipeline from Israel to Egypt has been completed, Steinitz told reporters on the sidelines of a regional gas forum in Cairo.

Egypt hopes to leverage its strategic location and well-developed infrastructure to become a key international trading and distribution centre for gas.

Steinitz said in January Israeli exports to Egypt were expected to reach 7 billion cubic meters a year over 10 years, and about half the exports were expected to be used for Egypt’s domestic market and half to be liquefied for re-export.

Separately, a plan to develop the Aphrodite gas field in Cyprus will be finalised within the next few weeks, Cypriot energy minister Giorgos Lakkotrypis told reporters in Cairo.

This plan will include extending a gas pipeline to Egypt, he added.

Cyprus expects initial natural gas production from the Aphrodite field will begin between 2024 and 2025.

Cyprus’ Aphrodite was first discovered in 2011, but production has been delayed since, as stakeholders Noble Energy, Israel’s Delek Drilling and Royal Dutch Shell renegotiate a production-sharing agreement with the government.

There have been a flurry of successful exploration efforts in recent years that identified natural gas reserves in the eastern Mediterranean, where gas output has begun to soar.

Eastern Mediterranean countries including Cyprus, Israel, Egypt and Italy have formed a partnership to deliver more natural gas to Europe and transform the region into a major energy hub. (Reporting by Ahmed Ismail, Writing by Nadine Awadallah and Mahmoud Mourad, Editing by Mark Potter)

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