Ministers of Energy from Israel, Cyprus, Greece and Italy today signed in Cyprus a memorandum of understanding (MoU) for the laying of an underwater gas pipeline from Israel to Italy, Israel's Ministry of National Infrastructures, Energy and Water Resources has announced. The ministry said, 'This is a major step in promoting the laying of an underwater gas pipeline from Israel via Cyprus, Greece and Italy."
During the summit in Nicosia, the four minister put out a joint statement that this is a strategic infrastructure project representing the shared interests of the countries and the EU regarding natural gas.
The planned pipeline will be 2,100 kilometers long, cost NIS 25 billion, and will be completed by 2025.
Minister of National Infrastructures, Energy and Water Resources Yuval Steinitz who has worked intensively to promote the project, said after the signing ceremony, "The vision that I declared in Israel took shape at the meeting in Cyprus today. The Israel-Italy underwater gas pipeline will make Israel an important player in the European energy market."
The planned pipeline will allow Israel to sign long term deals to export gas to Greece, Italy and other European markets. Steinitz said, "This project will strengthen the energy security of the EU and diversify Europe's sources of supply of natural gas."
The four Energy Ministers also pledged cooperation on research regarding construction of the pipeline.
EU representatives estimate that Europe will need to import 100 billion cubic meters of natural gas annually more than it imports today because of falling North Sea production. Europe sees Israel and Cyprus as a safe source of future natural gas supplies.
The four energy ministers will meet again to discuss the principles of the final agreement, which should be signed in 2018.
Even though there are still differences of opinion about the economic feasibility of the project, Steinitz has been enthusiastically pushing ahead with the pipeline. Greece based IGI Poseidon has been investigating the economic feasibility of the project with research support from the EU, which recognizes the project as a Project of Common Interest (PCI).
The planned pipeline will connect Israel's Leviathan gas field and run via Cyprus's Aphrodite gas field through the waters of Crete, mainland Greece and Italy. The initial estimate of the cost of the pipeline, which will be able to convey 12-16 billion cubic meters (BCM) of gas annually, is $6 billion. If further large fields are found in Israel or Cyprus, a double pipeline conveying 30 BCM annually could be laid.
Reports in "Globes" on Sunday that the pipeline MoU would be signed today has pushed up the share prices of energy companies on the Tel Aviv Stock Exchange (TASE).
Published by Globes [online], Israel business news - www.globes-online.com - on December 5, 2017
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