The Leviathan natural gas and LNG project consortium has signed a supply agreement with Palestine Power Generation Co. (PPGC) said Israeli energy company and partner in the Leviathan project Delek Group. The Palestinian company will buy 4.75 billion m3 of natural gas, worth US$ 1.2 billion, for a period of 20 years when the gas field comes online in either 2016 or 2017.
The price of gas determined in the supply agreement will be linked to Brent Crude prices, and includes "a floor price".
The Leviathan gas field is estimated to hold up to 537 billion m3, and, when discovered in late 2010, represented the largest offshore discovery in a decade. Reuters reported that PPGC plans to construct a US$ 300 million in the West bank city of Jenin. This will produce electricity from the gas.
Australian company Woodside Petroleum is in talks with Delek Group over the acquisition of a 30% stake worth US$ 1.25 billion in Leviathan. A final investment decision (FID) is expected to be made in the first half of 2014.
Edited from various sources by Ted Monroe