With New Gas Deals, Egypt Closes In On Energy Hub Goal

Sisi on Nov. 20 also visited Cyprus, where he discussed construction of a pipeline to deliver gas to Egypt from Cyprus's Aphrodite field, and a delegation representing Israel's Tamar gas field came to Cairo to discuss possible imports into Egypt.

Officials from Exxon Mobil have also recently held talks with Egypt to discuss investments in oil and gas.

One plan now is to reverse the flow on the pipeline to send gas from Israel's 7 trillion cubic feet Tamar field and the roughly 20 tcf Leviathan field to Egyptian liquefaction plants.

But this has been stymied by a dispute over gas that Egypt failed to deliver after 2012. The late-November visit to Cairo by Tamar field negotiators was their second in as many months.

The Israelis may prefer to build a new undersea pipeline that would bypass Sinai to avoid sabotage or use a separate pipeline that Egypt has built to Jordan, Syria and Lebanon, analysts said.

The challenge with Cyprus's 4.5 tcf Aphrodite field is mainly economic. At current gas prices, it is not big enough to justify an undersea pipeline to Egypt unless more discoveries are made elsewhere in Cyprus, analysts say.

Alternative routes for Egypt's neighbours, such as direct pipelines to Turkey, Greece or Italy, could be prohibitively expensive because of the depth of the seabed.

"Egypt is the least bad candidate. And it is also going very fast, which gives it a head start," Fabiani said.

(Reporting by Patrick Werr, additional reporting by Abdelrahman Adel; editing by Patrick Markey and David Evans)


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