Owners of Israel's Leviathan reservoir secure $568 million gas pump deal

The working interest owners of the Leviathan natural gas reservoir have made a final investment decision to proceed with the construction of a third gathering line connecting the Leviathan reservoir to the Leviathan Production Platform.

With an estimated budget of approximately $568 million, this crucial development is aimed at meeting the growing demand for natural gas both domestically in Israel and in the wider region.

The project entails the installation of a third subsea transmission pipeline, spanning a distance of approximately 120 kilometers west of Haifa within Israel’s Exclusive Economic Zone. The pipeline will link the field to the Leviathan Production Platform, situated 10km. offshore Dor. Once completed, this additional gathering line is expected to boost Leviathan’s production capacity from around 1.2 billion cubic feet per day (BCF/d) or 12 billion cubic meters (BCM) per year to nearly 1.4 BCF/d or 14 BCM per year.

Third gas gathering line in Leviathan is 'significant,' CEO says

Yigal Landau, CEO of Ratio Energies, highlighted the global increase in natural gas demand and the significance of the final investment decision for the third gathering line.

“We are pleased to announce a final investment decision for a third gathering line that will allow Leviathan’s production capacity to increase within two years. Additionally, we are actively working on expanding stage 1B and exploring transmission and export options to facilitate the transfer of substantial quantities of natural gas to customers in international markets,” said Landau.

The consortium anticipates that the new pipeline will commence gas flow in the second half of 2025, contributing to the stable supply of natural gas in the region. Notably, all critical equipment has already been allocated, and contracts have been secured, instilling confidence in the project's execution schedule.

Expressing his enthusiasm, Jeff Ewing, managing director of Chevron Mediterranean Limited, welcomed the investment decision and emphasized the project’s potential to enhance Israel’s energy security.

“Once completed, the additional pipeline will further enhance Israel’s energy security while providing ever-cleaner natural gas to markets that need affordable, reliable, and environmentally-friendly energy sources. We look forward to continuing to collaborate with the State of Israel as we seek ways to expand capacity to supply natural gas to meet the growing needs of Israel, the region, and the world,” he said.

Yossi Abu, CEO of NewMed Energy, regarded the third pipeline project as a crucial step in expanding the Leviathan reservoir’s role as an energy anchor in the Eastern Mediterranean. He acknowledged the surging demand in export markets and expressed optimism about the production capacity expansion and future liquefaction opportunities through a dedicated liquefaction facility. “This development will allow us to supply more natural gas to the local, regional, and very soon also the global market,” he noted.

The Leviathan reservoir's joint ventures are committed to meeting the rising natural gas requirements, fostering energy security, and capitalizing on export opportunities. With the approval of the third gathering line project, the consortium is poised to fortify Israel's position as a prominent supplier of natural gas, both regionally and globally.