Energean Signs Nitzana Transmission Deal to Advance Israel-Egypt Gas Pipeline
Energean Israel signed a 15-year transmission deal with Israel Natural Gas Lines for the Nitzana pipeline, advancing plans to link Israel’s gas network with Egypt and expand East Mediterranean export capacity.
(P&GJ) — Energean Israel Ltd. has signed a transmission agreement with Israel Natural Gas Lines Ltd. (INGL) for capacity in the planned Nitzana pipeline, a new onshore system that will connect Israel’s Ramat Hovav region to the Egypt border.
The deal supports Energean’s strategy to expand gas exports from Israel and strengthen regional energy connectivity in the East Mediterranean. Under the agreement, Energean will secure transmission capacity of up to 1 billion cubic meters per year for a 15-year period, with options for extension or early termination.
The Nitzana pipeline is expected to begin operations within 36 months once all three participating companies — Energean, Leviathan, and Tamar — finalize capacity agreements.
Energean’s share of construction costs for the pipeline and compression station is estimated at about $100 million, representing 16.4% of total project expenses. The company said the investment will be largely funded by a new unsecured 10-year, $70 million term loan from Bank Hapoalim, with payments tied to construction milestones.
Energean has also signed a non-binding term sheet with an East Mediterranean client for future gas offtake, subject to an export permit from Israel’s Petroleum Commissioner.
“Regional gas connectivity and long-term energy security in the East Mediterranean is of critical importance, which is why I am pleased today to announce the signing of the Nitzana transmission agreement,” said Energean CEO Mathios Rigas. “Energean is well positioned as a key regional player, and we remain focused on advancing all export opportunities from our Israeli assets.”
The project aligns with Israel’s Ministry of Energy policy to expand and optimize natural gas exports. While most of Energean’s revenue stems from domestic contracts, the company said the Nitzana agreement marks an important milestone in growing annual gas sales and export capacity.