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Jordan Reportedly Seeking Changes to $10 Billion Gas Deal With Israel

Jordan Reportedly Seeking Changes to $10 Billion Gas Deal With Israel

Israeli energy shares fell media reported that Jordan’s King Abdullah II had ordered a review of his country’s $10 billion agreement to import Israeli natural gas.

Citing senior Jordanian political sources, the Saudi-owned paper said the king made the decision “in a technical report that examines Jordan’s interests from the continuation or the freezing of the agreement.”

The sources told the paper the king was using the report to pressure Israel to lower its price for the gas and/or to deflect pressure from Jordan’s parliament to cancel the deal.

Jordan’s National Electric Power Company signed the agreement with Noble Energy, the Texas-based company that serves as operating partners for Israel’s Leviathan gas field, in September 2016.

The 15-year agreement calls for NEPCO to buy between 3 billion and 3.5 billion cubic meters of gas annually from Leviathan, beginning in the last quarter of 2019, after the pipelines are completed.

The agreement has been hailed in Israel as part of a growing regional energy partnership that includes Israeli gas exports to Egypt and will advance Israel’s ties with its Arab neighbors. In Jordan, however, it has elicited protests on the grounds that it would “normalize” ties with Israel at a time when no progress has been made on a peace agreement with the Palestinians.

On the Tel Aviv Stock Exchange, shares of Ratio, which has a 15% stake in the offshore Leviathan field, were down 1.9% at 2.98 shekels (83 cents) in late afternoon trading. Delek Drilling, which has a 45.3% holding, was down 2.4% at 10.90 shekels. Noble was up in New York 1.7% at $27.42 in premarket trading.