Israeli energy company NewMed has signed a $35 billion agreement to nearly triple natural gas exports from the Leviathan field to Egypt by 2029. Leviathan, jointly owned by NewMed, Chevron, and Ratio Oil, currently supplies Egypt with about 4.5 billion cubic metres (bcm) of gas annually, making it one of the country’s most important energy sources.
Under the new deal, annual exports will rise to around 12 bcm. NewMed’s chief executive, Yossi Abu, described the arrangement as a “win-win deal”, claiming Egypt will save significantly compared with importing liquefied natural gas (LNG). The agreement will see 130 bcm of gas supplied over the next 15 years—equivalent to roughly two years of Egypt’s total gas consumption.
Expansion Plans to Support Growth
To meet the increased demand, NewMed and its partners plan to expand Leviathan’s infrastructure. This year, a third supply line will be added to the offshore platform, raising output to 6.5 bcm annually by early 2026. By 2029, after $2.5 billion is invested in drilling two new wells and installing additional systems, production is set to reach the full 12 bcm per year target.
A new onshore pipeline from Israel to the Egyptian border at Nitzana is also planned to facilitate the increased exports. Abu said negotiations for the deal had been ongoing for two years and declined to link them to current political tensions, stating, “We are very focused on the commercial win-win — we are not political or geopolitical entities.”
Political Tensions Surround the Agreement
The deal comes at a time of strained relations between Cairo and Tel Aviv, largely due to Israel’s ongoing offensive in Gaza. Egyptian President Abdel Fattah al-Sisi has described the campaign as “genocide”, while public anger in Egypt has grown over the humanitarian crisis in the enclave.
Egypt is currently attempting to mediate a ceasefire, but many Egyptians are frustrated that their government has not done more to support Gazans. Dr HA Hellyer, a senior associate fellow in Middle East studies and security at the Royal United Services Institute, warned that some Egyptians might fear Israel could use its energy role to exert political pressure on Cairo.
Egypt’s Growing Dependence on Imports
Egypt, once a major gas exporter, has seen domestic production decline in recent years. This has increased its reliance on imported LNG and regional energy agreements. In the summer of 2024, soaring temperatures and daily rolling blackouts sparked public discontent and hampered economic activity.
In response, the government has stepped up imports and begun repaying debts to international energy companies to encourage further exploration and production.
