The agreement, involving US firm Chevron and Israel’s Leviathan field operators such as NewMed Energy, will supply about 130 billion cubic metres of gas to Egypt over 15 years, from 2026 through 2040.
This follows an initial commercial pact signed in August, delayed by negotiations over pricing and security terms.
The Egyptian Ministry of Petroleum and Mineral Resources said in August that the deal modifies a preliminary 2019 agreement, extending quantities and duration to 2040.
Deal details
The pact is valued at roughly $34.7 billion, with around $18 billion expected to flow directly to Israel for funding education, healthcare, and security.
Netanyahu said approval came after securing Israel’s national interests amid tensions in Gaza. Egypt has not yet issued an official statement, but the deal addresses its energy needs.
Difference from 2019 deal
The preliminary agreement signed in 2019 between the two sides was an arrangement to export gas from Israeli gas fields to Egypt in limited quantities over a longer period than previous deals.
The agreement provided for an initial quantity of gas estimated at around 60 billion cubic metres to be supplied to Egypt by 2030, with a specified annual volume of about 4.5 billion cubic metres.
The agreement was between companies involved in Israel’s Leviathan gas field and Egyptian/commercial entities, rather than a direct government-to-government deal, aimed at regulating Israeli gas exports to the Egyptian market.
It was the first official arrangement in recent years after Egypt had stopped exporting gas to Israel, and part of it began to be implemented following the start of production at the Leviathan field in late 2019.
Impact for Egypt
Egypt faces a persistent natural gas supply deficit, consuming around 6.2 billion cubic feet per day (bcf/d) while producing about 5 bcf/d. This forces it to rely on imports like LNG to meet peak summer demand.
Industrial sectors, including fertilizers and petrochemicals, account for roughly 25–40 percent of usage, with recent 10 percent supply increases for factories amid expanding production.
Production dips, such as to 3.485 bcf/d in April 2025, have increased LNG imports to 1.75 billion cubic metres in 2Q of 2025 from near zero previously.
Egypt's regasification capacity hit 2.25 bcf/d in July 2025 via floating storage units. However, the gap persists, costing $13.5 per million British thermal units and straining budgets.
Deals like the $3 billion LNG contract with Shell and TotalEnergies for 60 cargoes in early 2025 highlight vulnerabilities, alongside efforts to revive fields such as Zohr. Imports are planned through June 2026 to meet rising demand.
Israeli gas currently accounts for 10–12 percet of Egypt’s daily supply, according to official figures. The new $35 billion deal will increase flows from 4.5 to 6.5 bcf/d in 2026, potentially reaching 12 bcf/d by 2029 after Leviathan expansion.
Estimates suggest that this could cut LNG imports by 1–2 billion cubic metres initially, easing supply pressures, boosting energy security, and helping Egypt position itself as a regional exporter.
The Leviathan deal is expected to reduce Egypt's LNG import needs starting in 2026 by providing cheaper pipeline gas and addressing supply deficits amid declining domestic production.
Natural gas supply scene
Egypt’s gas production showed a modest month-on-month increase in September 2025, according to the Energy Research Unit (ERU), a Washington-based research body affiliated with the Energy Platform.
ERU is known for its in-depth analysis and comprehensive annual reports on global and Arab energy markets, covering oil, gas, renewable energy, hydrogen, and electric vehicles.
Output rose to 4.15 billion cubic feet per day in September, up from 4.06 billion cubic feet per day in August, supported by new gas discoveries and incentives offered to foreign operators, alongside the regular settlement of outstanding payments.
Despite this improvement, overall output remains below last year’s levels, averaging 4.11 bcf/d between January and September 2025 compared with 4.90 bcf/d in the same period of 2024, reflecting challenges amid rising domestic demand.
Egypt aims to expand natural gas production to around 6.6 bcf/d to secure fuel for power and industrial sectors and reduce import dependence, particularly during peak demand.
The strategy was reinforced by successful exploration in 2024 and 2025, which expanded proven gas reserves and sped up development of several existing fields.
The Leviathan deal provides short-term relief for Egypt’s energy supply. Its long-term value will depend on how quickly Egypt converts temporary supply into lasting energy security through higher domestic production and improved demand management.
Short link: