Israel approves landmark 35 billion dollar natural gas agreement with Egypt

Israel has given the green light to a deal valued at 112 billion shekels ($35 billion) to supply natural gas to Egypt from 2026 to 2040, overcoming several objections regarding the terms of the agreement.

In a televised statement on Wednesday, Prime Minister Benjamin Netanyahu announced his approval of the deal after ensuring that national interests were secured, describing it as the “largest gas deal in Israel’s history.”

The agreement stipulates the delivery of 130 billion cubic meters of gas to Egypt, based on terms initially disclosed in August. The deal involves Chevron and its partners, NewMed and Ratio, operating within the framework of the Leviathan gas field. The Leviathan reserve is estimated to hold approximately 600 billion cubic meters.

“This agreement significantly strengthens Israel’s position as a regional energy power and contributes to the stability of our region,” Netanyahu stated. “It encourages other companies to invest in gas exploration within Israel’s economic waters.”

Under the agreement, Egypt will increase its contracted gas purchases from Israel’s offshore Leviathan field, which is operated by the US energy giant Chevron.

Israeli Energy Minister Eli Cohen had previously refused to sign the export license, demanding better pricing for Israel and noting that he had faced “intense” pressure from the US to finalize the agreement.

Cohen later indicated that “differences in perception have largely narrowed,” signaling that the deal had reached its final stages.

In a statement on Wednesday, Cohen noted, “Thanks to this agreement, the state’s tax and royalty revenues will reach approximately 58 billion shekels, and the scope of direct infrastructure investments into the economy will exceed 16 billion shekels.”

Egypt has been purchasing large quantities of liquefied natural gas (LNG) since becoming a net natural gas importer in 2024, driven by rising domestic demand and declining production from its own fields.

The supply agreement with Israel could mean that the North African nation will require fewer LNG imports in the future.

A spokesperson for Chevron stated that the company welcomes the decision to grant the permit for natural gas exports from the Leviathan field to Egypt.

In November, Chevron indicated it was nearing a final investment decision for the expansion of the Leviathan gas field off Israel’s Mediterranean coast but had been waiting for authorization from Israel to export the gas to Egypt.