Approved: Record Gas Export Deal with Egypt - Projected to Generate NIS 58 Billion

Prime Minister Benjamin Netanyahu announced Wednesday evening that the Israeli government has approved the largest natural gas export deal in the country’s history, centered on gas sales to Egypt. According to Netanyahu, the agreement is valued at NIS 112 billion, with expected state revenues of NIS 58 billion over the life of the deal.

The agreement involves Israel’s flagship Leviathan gas reservoir, operated by the American energy giant Chevron, alongside Israeli partners. Gas will be supplied to Egypt through an expanded export infrastructure.

U.S. Pressure and Egypt Relations

Approval of the deal comes amid efforts to arrange a summit between Netanyahu and Egyptian President Abdel Fattah el-Sisi, following months of tension between Jerusalem and Cairo during the war—particularly over the Rafah crossing.

According to a diplomatic source, the United States actively pushed for the deal’s approval, after Netanyahu delayed it, viewing the agreement as strategically important for regional stability and energy cooperation.

Billions for the Treasury: Revenue Timeline

In a joint statement, Netanyahu and Energy and Infrastructure Minister Eli Cohen outlined the projected financial impact:

• First four years: Approximately NIS 500 million to the state treasury

• Within several years: Annual revenues expected to rise to NIS 6 billion

“These funds will strengthen education, health, infrastructure, security, and the future of generations to come,” the statement said.

Netanyahu emphasized that the deal was approved only after ensuring Israel’s security and vital national interests, calling it a move that “significantly strengthens Israel’s position as a regional energy power.”

Details of the Leviathan–Egypt Agreement

The export permit builds on an agreement signed in August, when Leviathan partners Ratio, NewMed Energy, and Chevron announced a major expansion of gas sales to Egypt.

Key elements include:

• Total volume: Approximately 130 billion cubic meters (BCM)

• Estimated value: About $35 billion

• Duration: Through 2040, or until full delivery

• Buyer: Blue Ocean Energy (BOE), which already imports Israeli gas to Egypt

The new deal expands an existing export framework of 60 BCM, expected to be completed by the end of the decade. Since production began, 23.5 BCM of gas from Leviathan has already been sold to Egypt.

Pricing Safeguards and Domestic Priority

The Energy Ministry stated that mechanisms were included to improve pricing for the Israeli economy, with one option setting prices at up to $4.7 per unit of combined heat and power.

Additional safeguards include:

• A requirement that short-term (SPOT) gas sales not exceed prices of long-term contracts

• Authority granted to the Petroleum Commissioner, starting in 2032, to reduce export volumes in favor of domestic needs, including competition considerations

“This deal obliges the companies to sell gas at a good price for Israeli citizens,” the ministry emphasized.

Chevron Welcomes Decision

Chevron responded positively to the government’s approval, stating:
“The company welcomes the decision of the Israeli government and the Ministry of Energy to grant a permit to export natural gas from the Leviathan reservoir to our customers in Egypt.”

Concerns Over Energy Security and Consumer Prices

Despite the economic benefits, concerns remain that increased exports could raise domestic gas and electricity prices and undermine Israel’s long-term energy resilience.

An inter-ministerial committee led by Energy Ministry Director General Yossi Dayan warned in an interim report published last April that Israel’s gas reserves may last only about 20 more years. Continued depletion could turn Israel from a gas exporter into an importer within the next decade.

With more than 70% of Israel’s electricity generated from natural gas, any future shortage could have significant consequences for electricity prices and the cost of living.

Strategic Gamble

The record-setting deal marks a major milestone in Israel’s energy policy and regional diplomacy. At the same time, it highlights the growing tension between maximizing export revenues today and safeguarding long-term energy security for the Israeli economy.