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U.S oil and gas major, Chevron Corporation CVX and its partners decided to invest $24 million to bolster the natural gas production capacity of the Tamar reservoir, off the coast of Israel. The offshore site is a major source of energy for the country. It also supplies natural gas to Egypt and Jordan. The investment is part of a two-phase plan that will bolster the natural gas production capacity to about 1.6 billion cubic feet (BCF) per day.
The Tamar gas field is operated by Chevron, with a 25% stake. The project’s partners are Isramco, Mubadala Energy (Abu Dhabi), Tamar Investment 2, Tamar Petroleum, Dor Gas and Everest, which hold rights of 28.75%, 11%, 11%, 16.75%, 4% and 3.5%, respectively.
The Tamar consortium approved a final investment decision (FID) required to kick off the second phase of the expansion project.
In the first phase, a 150-kilometer pipeline will be laid from the Tamar field to the platform. It is expected to aid the current natural gas production of 1.1 BCF and increase it to 1.2 BCF. In the second phase, Chevron stated that it had plans to restart the compressors located in the onshore station in Ashrod. This is in line with a previous decision, which mentions investments in a third pipeline between the field and the drilling platform. The work on both the phases is expected to be completed by 2025. The investment amount for both phases totaled $673 million.
Chevron’s Eastern Mediterranean Business Unit stated that reaching the FID for Phase 2 of Tamar gas field’s expansion demonstrates the company’s commitment to work together with Israel for the development of its energy resources, which will benefit the domestic as well as regional gas markets.
The investment decision for Tamar expansion project came in after the partners signed a new gas sales agreement with Blue Ocean Energy. Per the agreement, the Tamar partners will sell an additional 4 billion cubic metres (BCM) of natural gas per year to Egypt for a duration of 11 years. Currently, the Tamar reservoir exports around 2 BCM per year. The additional gas exports are scheduled to commence on Jul 1, 2025.
The expansion of natural gas exports to Egypt was approved by Israel in 2023. However, one-third of the additional natural gas produced after the expansion project would be utilized to meet the energy demands of the domestic market.
The Tamar platform, situated off the coast of Ashkelon, was shut down owing to the aftermath of the conflict in Gaza that started on Oct 7, 2023. The platform had to go through a five-week shutdown and resumed operations in mid-November. On the contrary, Israel’s Leviathan natural gas platform, the largest in the country, remained operational throughout the war.