NATGAS: Israel’s NewMed Eyes Leviathan-Saudi Gas Sales: MEES

Israeli upstream player NewMed Energy touted Saudi Arabia’s Neom as a possible destination for gas volumes from Israel’s Leviathan offshore gas field, MEES said.

• However, MEES has deemed this unlikely, even looking beyond the political barriers to Saudi Arabia importing gas from Israel.
• If Israel is to fully take advantage of its gas reserves, development of new markets beyond neighbours Egypt and Jordan is essential.
• Jordan receives regular volumes from Israel, while Egypt’s gas demand looks boundless amid declining output.
• However, overdependence on certain markets as an outlet for its gas could leave Israel exposed, so diversification is key.
• FLNG has been suggested as a potential alternative, opening the gas to a global market. However, that idea has largely been shelved, with the focus on expanding pipeline connections between both Egypt and Jordan.
• The geographic proximity of Saudi’s Neom project on the Red Sea could make it a candidate, but the politics of such a move make it difficult to see the project getting off the ground.