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BG and Leviathan negotiate LNG supply agreement

LNG Industry,

Partners in the Leviathan natural gas project offshore Israel announced the signing of a non-binding letter of intent (LOI) with BG of the UK for the supply of feed-gas to BG’s LNG plant in Idku, Egypt.

The letter set out a binding agreement for the supply of 7 billion m3/year for a period of 15 years. Supply would take place from the Leviathan floating production, storage and offloading (FPSO) unit, which would be connected to Egyptian LNG facility through a subsea pipeline. According to the LOI, the price of gas will be determined in a formula to be agreed by the parties.

The Leviathan consortium includes majority stakeholders Noble Energy (39.66%), Anver Oil exploration (22.67%), Delek Drilling (22.67%) and Ration Oil Exploration (15%).

A statement from Delek said the following:

As of the date of this report, the parties estimate that the Binding Agreement will be subject to several contingent terms, including the development of the Leviathan Project, which is subject inter alia to binding final investment decisions by each of the Leviathan Partners and to receipt of all required approvals from the authorities in Israel and Egypt.”

In May, Woodside terminated a memorandum of understanding (MoU) to but a 25% stake in the Leviathan joint venture.

Edited from various sources by Ted Monroe

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