The Israel-Egypt Gas Deal Increases Stability in the Eastern Mediterranean

In February, the two firms that own the rights to the natural-gas fields beneath Israel’s coastal waters signed a deal to begin exporting gas to an Egyptian company, which will then liquefy it for export and domestic consumption. Oded Eran, Elai Rettig, and Ofir Winter explain that, although the deal is not without its risks—especially since any pipeline could be vulnerable to attack by Hamas, Hizballah, or Islamic State—it will likely improve relations among Israel and its neighbors:

Egypt offers Israel a growing local market [for its gas] and the possibility of using its liquefaction facilities, [the only such facilities in the region], to transport gas to Europe. . . . Apart from the pipeline to Egypt, a pipeline to Jordan is [also] under construction, as part of an agreement signed in 2016 to supply 45-billion cubic meters of gas over fifteen years. . . .

The deals with Jordan and Egypt have great strategic value for Israel and the region. They might possibly be joined by a future deal with the Palestinian Authority (PA). . . . These agreements stabilize Israel’s relations with its neighbors by creating a web of mutual interests and opening up the possibility of regional cooperation beyond the subject of natural gas, such as the export and import of electricity and desalinated water.

In security terms, the flow of gas from Israel to Egypt, Jordan, and the Palestinian Authority makes this a regional and not just Israeli interest. . . . [A]ny damage by Hizballah or Hamas to Israel’s ability to produce gas will also affect the supply of electricity to Jordan, Egypt, and the PA. The threat will become an important component in intelligence and security cooperation among neighboring countries in identifying and preventing sabotage, and a catalyst for them to seek calm if fighting breaks out with one of these [terror] organizations. In economic terms, [a successful] partnership between Israel and its neighbors with regard to energy resources will encourage the entry of new investors into the eastern Mediterranean and show them that it is possible to implement large-scale production and export projects requiring regional cooperation.

The deal could also have implications regarding the . . . unresolved dispute between Israel and Lebanon over maritime borders, [which] is a political and security nuisance for Israel [but] has not prevented either Egypt or Jordan from entering into long-term engagements with Israel in the field of energy. Clearly, hostilities between Israel and Lebanon would have destructive consequences, particularly for Lebanon, inter alia by reducing its ability to use the oil and gas in its waters, but they would also damage Israeli interests regarding the development of gas reservoirs close to the border. [Therefore], it would be best for countries that have diplomatic relations with Lebanon, particularly those whose energy companies are involved in gas development, to work toward reducing the bellicose rhetoric currently coming from Beirut.

Read more at Institute for National Security Studies