Will Israeli gas keep Europe warm over winter?

Israel’s natural gas production surged 22% in the first half of the year, as the government plans to ramp up exports that will make their way to Europe, where the worst energy crisis in decades is under way.

Production rose to 10.85 billion cubic meters year-on-year through June, with exports to Israel’s neighbors rising by 35% to 4.59 billion cubic meters, according to the energy ministry. Much of the increase is due to production from the Tamar and Leviathan reservoirs in the eastern Mediterranean.

Royalties from gas, minerals and fees rose roughly 50% to reach 829 million shekels ($253 million), almost all of which was from gas. 

Energy Minister Karine Elharrar said the increased production in the first half of the year would help Israel sell its gas to the EU as part of the trilateral agreement, adding that production would likely to continue to expand once the Karish rig begins operations. 

In June, Israel signed a memorandum of understanding with Egypt and the EU aimed at boosting regional gas production and exports. Gas will be shipped to Egypt, which already receives the bulk of Israel’s gas exports, and then re-exported to the bloc. Initial flows under the deal aren’t expected to be substantial, but could provide Europe with some of the gas it needs as Israeli output rises further in the years ahead.