Israel's oil shares decline as Egypt halts gas import in 2018

CAIRO – 17 November 2017: Israel's largest oil companies recorded sharp declines in shares after recent statements were issued from Minister of Petroleum Tarek al-Mulla stating that Egypt will halt importing liquid gas during 2018, the Israeli newspaper Globes stated Wednesday.

Al-Mulla said during an interview with Bloomberg that Egypt will stop importing liquefied natural gas in 2018 and may eventually export gas after it starts producing gas this year at the giant Eni SpA-operated Zohr field, which is located off the country’s Mediterranean coast.

Zohr’s output will mostly supply the domestic market, and the nation’s two existing gas-liquefaction facilities are large enough to process any available surplus into LNG for international sale in 2019, Al-Mulla said Tuesday in an interview in Abu Dhabi.

If Zohr and other gas fields generate enough supplies, Egypt may consider adding a third LNG-exporting terminal, he said. Israeli gas stocks dropped on the news.

Zohr is the largest natural gas field found in the Mediterranean and was discovered in 2015 by Italy’s Eni. The field has an area of 100 square meters at a depth of 1,450 meters.

Investing around $10 billion in the project, Eni is estimating total output of the field to be approximately 30 trillion cubic feet of gas.

The field will start production through three phases. The first phase will see an output of one billion cubic feet per day. When all seven fields are complete by 2019, this amount will increase to 2.7 billion cubic feet per day.

The field is expected to secure Egypt’s domestic needs of gas after it has become a net importer of gas following a cut in production after the January revolution.