While it was reported in Jordan yesterday that the negotiations on importing Israeli gas from the Leviathan reserve had been halted, Bloomberg reports that Jordan, which is in need of cheaper sources of energy, will import gas from the Gaza Marine field 35 kilometers from the coast of the Gaza Strip. According to Bloomberg, the Jordanians will import 1.5-1.8 BCM (billion cubic meters) of gas annually.
The Gaza Marine reserve was discovered in 2000. It contains 32 BCM, and is owned by British Gas (60%), which also operates the reserve, Consolidated Contractors Company (CCC) (30%), and the Palestinian Authority (10%).
Meanwhile, despite the tension between Israel and Jordan in recent weeks, industry experts say that, since the proposed Leviathan deals are long term, for 15-20 years, both sides understand that there will be ups and down in relations between them, and this will not affect the signing of an agreement. Technically speaking, the option of exporting gas to Jordan is cheap and quick, since it requires laying an onshore pipeline only a few kilometers in length.
From an economic point of view as well, it would pay both sides to sign a deal. Jordan currently has to import 97% of the energy it consumes, and it pays for it at least double what it would pay for the Israeli gas. It is estimated that the Jordanian economy would save $1.5 billion annually by switching to Israeli gas. For their part, the Israeli gas partnerships would receive a higher price than they can obtain in Israel.
Published by Globes [online], Israel business news - www.globes-online.com - on January 5, 2015
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