The Israeli partners in the Leviathan gas reserve Avner Oil and Gas LP (TASE: AVNR.L), Delek Drilling and Ratio Oil Exploration (1992) - reported this morning that a non-binding memorandum of understanding was signed at the weekend with BG Group (BG), in which the sides confirmed their intention of conducting negotiations on an agreement for the sale of natural gas to BG's liquefaction plant in Idku in Egypt.
British company BG Group explores for, produces, transports, liquefies and sells gas in more than twenty countries.
The estimated size of the proposed deal is the supply of seven BCM (billion cubic meters) of gas annually for 15 years. The value of the agreement is estimated at some $30 billion. Moreover, the sale will take place in Israel, close to the production point of gas from the reserve, so that BG rather than the Leviathan partners will have to construct a special pipeline. Gas will be supplied to BG from the floating gas production and storage installation, which will be connected to the liquefaction plant in Egypt via an undersea pipeline.