Israel's Tamar gas rig
Israel's Tamar gas rigMoshe Shai/Flash 90

The Leviathan partners have notified the Tel Aviv Stock exchange that they signed a $2 billion gas deal with Or Energies, who will buy 8.8 billion cubic meters of gas over the next 20 years.

The gas will be used to operate Or Energies' future power station. However, the plans to build the power station have not yet been approved, and there is no guarantee they will be.

The Leviathan partners are a group of gas and oil companies who own shares in Israel's offshore gas fields.

The Leviathan partners notified the Tel Aviv Stock Exchange this morning that they have signed a $2 billion deal to sell 8.8 billion cubic meters of gas to Or Energies over 20 years. The gas will be used to operate the power station that Or Energy plans to build.

"We are happy to join up with a veteran partner in Israel's natural gas revolution, Or Energies, which becomes a customer in the historic project of developing the Leviathan field. Natural gas from Leviathan will facilitate the construction of more power stations producing electricity from natural gas, and allowing the Israeli economy to move another step ahead...for the benefit of all of us," Delek Drilling and Avner CEO Yossi Abu, said.

A gas drilling ship arrived on the site on October National Infrastructure, Energy, and Water Minister Yuval Steinitz (Likud) said, "For me, the fact that a ship is here is a dream."

A gas pumping team recently arrived in the Mediterranean for the purpose of pumping oil from the Tamar 8 well, and in February they are set to begin pumping oil from the Leviathan site as well.

"For me, the fact that the ship is here is a dream.... For me, it is a dream come true," Steinitz said. "A year-and-a-half ago, it looked like a fantasy."

Earlier this year, Israel and Turkey agreed to begin discussing a deal that would include building a gas pipeline from the Leviathan site to Europe. The first sale to a power plant, this one in southern Israel, was signed in May of this year.