Others
Mon, 08/09/2014, 04:49 GMT+7
Jordan signs US$ 15 billion agreement on purchasing gas from Israel
On 3rd September, Israel signed a memorandum of understanding for supply of natural gas worth US billion to Jordan from Israel's Leviathan gas field for 15 years.

The cooperation agreement between the two countries is the greatest ever, helping Israel become the largest gas supplier of Jordan.

 

According to the deal, Israel will supply 8.5 million m3 gases per day, reaching 45 billion m3 gases upon the contract expiration. Negotiation on pricing, terms and conditions between both sides is expected to be finished by the end of this year, and then Jordan will begin importing gas according to the contract with Israel as from 2017.

 

Jordan has switched to import gas from Israel following interrupted supply from Egypt due to the terrorist attacks pointing at the pipeline system on Sinai Peninsula of Egypt.

 

Earlier in February, Israel signed another US$ 500 million agreement supplying gas to Jordan from Tamar natural gas field in the Mediterranean.

 

Jordan’s Minister of Energy and Mineral Resources Mohammad Hamed said that gas import not only solves the fuel crisis in the country but also helps the National Electric Power Company (NEPCO) to reduce loss because it was estimated that NEPCO may suffer nearly billion loss this year. For Israel, this agreement is an opportunity to improve relations with the neighboring countries including Jordan and the Arab.

 

In the agreement between the two countries, there is also the participation of American company, i.e. Noble Energy with 40% shares of Leviathan Company. In 2010, Noble discovered Leviathan, the world’s largest natural gas field offshore Israel.

 

In another move, the State news agency Petra reported that the Government of Jordan has signed four contracts with Eesti Energia, an energy company of Estonia to build in the country a giant shale oil-operated power plant with the capacity of 40MW.

 

The above contracts last for 27 years with total construction investment of up to US$ 2.4 billion. It is expected that the power plant would be put into operation in early 2018.

 

According to statistics, Jordan has the shale oil reserves of 40 billion tons. Currently, the country has to import 96% energy needed, spend US$ 2.8 billion per year, equivalent to 21% GDP. Thus, Jordan is attempting to produce energy to meet the increasing demand of the country.