Tamar partners negotiating sale of natural gas to Egyptians

The partners in Israel’s offshore Tamar gas field said on Sunday they are negotiating the sale of at least five billion cubic meters of gas over three years to private customers in Egypt via an old pipeline built to send gas in the other direction.

Under the agreement, the supplies would pass through a combined underwater pipeline constructed nearly a decade ago by East Mediterranean Gas, the company that oversaw a now-defunct Egyptian-Israeli natural-gas deal.

Egypt had been selling gas to Israel under a 20-year agreement, but the deal collapsed in 2012 after months of attacks on the pipeline by militants in Egypt’s lawless Sinai Peninsula. It has since been out of commission and EMG is suing the Egyptian government for damages.

Recent offshore discoveries such as Tamar, with an estimated 280 BCM of gas, and Leviathan, which is more than twice as big, have turned previously import-dependent Israel into a potential energy exporter. Egypt has been slow in developing its own sizable gas resources and now faces an energy crisis.