Negotiations for the Transfer of Israeli Gas through Turkey to Europe 'in Final Stage'

The advisor to the Israeli Minister of Infrastructure, Energy, and Water announced in an interview with Turkey's official news agency, Anadolu, that negotiations between the two countries for the transfer of Israeli gas to Europe are in the 'final' stage. Dor Cohen further stated that the parties are currently negotiating the price of gas, the route for the pipeline construction, final destinations, and the volume of gas exports. The 'East Med' pipeline is set to transport gas from fields located in the Eastern Mediterranean, including Israel's Leviathan gas field, to Italy and Greece. Mr. Cohen expressed hope that the parties would show sufficient flexibility to reach an agreement. Yuval Steinitz, Israel's Minister of Infrastructure, Energy, and Water, recently held discussions with Turkish officials regarding this project on the sidelines of the World Petroleum Conference in Istanbul and announced that the parties have reached an agreement to create a government support umbrella for this project, which could pave the way for the construction of the 'East Med' pipeline to begin by the end of this year. He mentioned that recent negotiations have also taken place with regional companies and governments. Steinitz noted that Turkey is very important as a gas transit route for Israel, but the country is also considering other options such as exports through Greece or Egypt to Europe, and exports could even occur simultaneously through two different routes. He emphasized that timing is crucial, and the upcoming visit of Berat Albayrak, Turkey's Minister of Energy, to Tel Aviv could be a step forward for signing the government support umbrella for the mentioned pipeline. He pointed out Turkey's significant imports and annual gas consumption of 50 billion cubic meters, stating that Israeli gas could pass through Turkey, but Tel Aviv's considerations must be met to begin construction of this project. Russia, Iran, and Azerbaijan are Turkey's largest gas suppliers. According to data from Turkey's Energy Market Regulatory Authority, Iran has increased its gas exports to Turkey by 46% in the first seven months of this year compared to the same period last year, reaching over 5.5 billion cubic meters. Turkey has had nearly 32 billion cubic meters of gas imports in the first seven months of the year, making Iran's share in supplying Turkey's gas more than 17%. The advisor to the Israeli Minister of Infrastructure, Energy, and Water stated that Israeli gas will be one of the most competitive energy supply sources for Turkey and Europe in terms of price, which requires long-term contracts. Israel currently has two major gas fields, Leviathan and Tamar, with recoverable reserves exceeding 900 billion cubic meters, and is looking to export gas to regional and European markets. Egyptian President Abdel Fattah el-Sisi also announced last month that changes have been made to the country's laws to facilitate the purchase of gas from Israel. According to Bloomberg, the new laws include permits for the import or transit of gas to non-governmental companies. Previously, the non-governmental company Dolphinus in Egypt had agreed in 2015 to purchase three billion cubic meters of Israeli gas annually, which will be supplied through the Tamar field. Israel is also completing the Leviathan project for gas production by 2019.