03/09/2014
Hedy Cohen
Source: Globes Israel's Business Arena

Jordan signs MOU to buy $15b Leviathan gas

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03/09/2014, 17:07

Hedy Cohen

The Jordanian Electric Power Company wants to buy 45 BCM of gas over 15 years.

The partners in the Leviathan natural gas reservoir have signed another agreement with Jordan. The new agreement is worth $15 billion, much larger than the two previous deals signed. Tel Aviv Stock Exchange (TASE) trading in the shares of the partners - Ratio Oil Exploration (1992) LP (TASE:RATI.L), Avner Oil and Gas LP (TASE: AVNR.L), and Delek Drilling Limited Partnership (TASE: DEDR.L) - was halted ahead of the news.

 Delek Drilling CEO Yossi Abu and Noble Energy senior VP J. Keith Elliot are currently in Jordan to sign a giant deal with the Jordanian Electric Power Company (JEPCO). The deal covers 15 years, during which 3 billion cubic meters (BCM) of gas will be sold to Jordan annually - a total of 45 BCM.

Jordan's total natural gas consumption is estimated at 4.5 BCM annually, and as of now, it must use diesel fuel and fuel oil as a substitute for gas. Jordan formerly imported 2.5 BCM from Egypt through the Arab Gas Pipeline (AGP). The shortage of gas in Egypt and the problems and sabotage in Sinai, however, eventually caused an almost total halt in the flow of gas to Jordan.

According to an Israeli cabinet decision dated June 23, 2013, up to 40% of the natural gas reserves discovered in Israel can be exported either by pipeline or as liquid natural gas (LNG). Of the 113 trillion cubic feet (TCF) consumed worldwide, only 11 TCF are consumed as LNG, because it is usually expensive, takes a great deal of time, and is more technically complex than gas through a pipeline.

This explains why the Tamar and Leviathan partners want to use a pipeline for exports; furthermore, a land-based pipeline is cheaper than an undersea pipeline. Gas can be exported by pipeline from the Tamar and Leviathan reservoirs to the Palestinian Authority (PA), Jordan, Egypt, Cyprus, and Turkey, of which the PA and Jordan are the most accessible. The PA's consumption capacity is limited, which makes the Jordanian market the most attractive.

Simultaneously with its negotiations with Israel, Jordan is also considering other options for importing natural gas. These include importing gas from Basra, Iraq to Aqaba Port in Jordan, LNG imports through Aqaba Port while using a floating storage regasification unit (FSRU) to reconvert LNG to gas, and additional gas exploration in Jordan (an option that has not produced many results to date, given that only 200,000 cubic meters, all consumed in 2013, have been found there so far).

Last February, the Tamar partners announced that an agreement had been signed to sell natural gas from the reservoir to Jordanian companies Arab Potash and Jordan Bromine, which operate on the Jordanian side of the Dead Sea. The gas was sold through a US company named NBL Eastern Mediterranean Marketing controlled by Noble Energy, which owns 36% of the Tamar reservoir, while Isramco owns 28.75%, Delek Drilling and Avner 15.625% each, and Dor Gas 4%. The agreement is for 15 years, with a total value of $500 million. Under this agreement, 1.8 BCM will be supplied to the Jordanian companies, and gas is slated to start flowing in 2016, when the pipeline to Jordan is completed.

Israel Natural Gas Lines (INGL) will be responsible for laying the pipeline, with financing from the Tamar partners. As of now, however, there are still problems with the pipeline route, which is expected to pass through nature reserves at the southern Dead Sea.

Link:  globes.co.il/en/article-jordan-signs-mou-to-buy-15b-leviathan-gas-1000969042.

Jordanian throws shoes at PM over price hikes

15 April 2014
By Staff writer
Al Arabiya News

Authorities arrested a Jordanian on Monday after he threw a pair of shoes at Prime Minister Abdullah Nsur, along with five cabinet ministers, during a ceremony in the northern city of Jerash, an official said.

“The prime minister was talking about the economy, when Mefleh Mahasneh, 65, head of the Jerash countryside society that was attending the event, stood up and told the prime minister: ‘You raised the prices’,” the municipality official told Agence France-Presse.

“The mayor told Mahasneh to stop because it was not his turn to talk. Mahasneh, an army retiree, got angry and took off his shoe and threw it towards the stage on which the prime minister and the ministers were sitting.”

Mahasneh then took off his other shoe and threw it in the same direction. “The pair of shoes landed on a table on the stage. Police then arrested Mahasneh.

“I think he was detained for his own protection because some attendees threatened to take action against him,” added the official.

A wave of nationwide protests and strikes were sparked after Nsur’s government raised fuel prices, including house gas, by up to 52 percent in November 2012. The price surge was imposed to help cut a government deficit of 3.5 billion dinars (around $5bn), AFP reported.

Jordanians also took to the streets to protest growing unemployment and poverty rates, and demanded political and economic reforms in the kingdom as well as anti-corruption efforts.

Security personnel present at the event gathered footage of the incident so as to prevent its dissemination in the media, local news outlets reported.

(With AFP)

Link:  .alarabiya.net/en/News/middle-east/2014/04/15/Jordanian-throws-shoes-at-prime-minister-over-price-rise.html.

Jordan set to end reliance on Egyptian gas

December 17th, 2011
By Taylor Luck
Source: Jordan Times

JORDAN IS SET to move away from Egyptian gas due to the growing unreliability of the country’s main energy source, officials say.

In a statement earlier this week, Minister of Energy and Mineral Resources Qutaiba Abu Qura announced that the ministry is intensifying efforts to secure alternatives to Egyptian gas, on which Jordan relies for 80 per cent of its electricity generation needs, adding that the resource will not factor in the Kingdom’s future energy plans.

The minister’s statement, issued during a meeting of the Lower House Finance Committee, came amidst reports in the Egyptian press that Amman has gone back on its decision to ratify a new natural gas agreement, which was approved by the Cabinet in August and has been pending Cairo’s approval.

Officials denied that Jordan has formally withdrawn its support for the amended agreement, under which Egypt is expected to triple gas prices.

“We have had no developments, either towards ending or signing the new agreement,” Farouq Hiyari, the energy ministry’s secretary general, told The Jordan Times.

Despite the denials, according to a ministry source, frustration over the unreliability of gas supplies and a lack of communication from the Egyptian side has led Jordanian officials to “give up” on an arrangement that at its peak supplied the Kingdom with some 300 million cubic feet per day.

The Egyptian ministry of petrol declined to comment.

Cairo has yet to resume pumping since a Sinai explosion cut supplies on November 28, marking the ninth attack on supply line since the beginning of the year and the third in less than a month.

The most recent attacks came amidst assurances by Egyptian authorities that an increased military presence in the Sinai Peninsula combined with the arrest of several jihadists allegedly behind the spate of attacks would lead to the security of the pipeline.

According to sources at E-Gas, one of the two firms that oversee the 400-kilometre Arab Gas Pipeline - which also supplies Israel - repairs have faced “unexpected” delays leading to the prolonged disruption, which has forced the Kingdom’s power plants onto their fuel reserves at a cost of some JD3 million per day.

Economists say the series of attacks have had a direct impact on Jordan, with the series of disruptions pushing the national energy bill to record levels - over JD4 billion - and expected to widen the National Electric Power Company’s budget deficit to JD1.4 billion by the end of the year.

“For months NEPCO has covered the difference in price between natural gas and heavy oil, but this burden has become unsustainable,” NEPCO General Manager Ghaleb Maabreh recently told The Jordan Times.

According to officials, a ministerial team is to travel to Cairo “soon” to review the issue of gas supplies with their Egyptian counterparts before Jordan formally moves to end its decade-long reliance on Egyptian gas.

Meanwhile, Hiyari said talks are intensifying with Iraq and several Arab Gulf states over the potential of importing natural and liquid gas over the next decade as Jordan attempts to develop domestic energy sources including oil shale and nuclear power.

Despite the renewed efforts to secure additional energy sources, officials say it will take up to two years from the signing of any agreement before Jordan can benefit from a new energy market due to infrastructure requirements.

Should Jordan decide to end its decade-long reliance on Egyptian gas supplies, Hiyari said the government will resort to the international energy market to maintain electricity generation in parallel with its drive to secure additional energy sources.

“We will have no problem meeting the needs of electricity plants needs with oil and diesel during this period,” Hiyari said.

Energy officials privately conceded that the move will impact electricity tariffs as heavy fuel oil and diesel are much costlier than Egyptian gas imports, which Jordan previously received at prices of less than half the international market rate.

Sources claim the government has previously hesitated to formally end the country’s gas deal with Egypt for fear of raising electricity tariffs at a time of popular unrest over a struggling economy and a stalled political reform drive.

“Officials have finally come to the decision they can no longer wait around for the Egyptian situation to improve,” said an energy official who was not authorised to speak to the press.

“They have come to the terms that Jordan can no longer rely on subsidised energy.”

While an added economic burden for citizens, industry observers say the move away from Egyptian gas will serve as a boost to Jordanian oil shale, which experts say is cost competitive with unsubsidised natural gas, and renewable energy, which advocates claim has long been neglected in favour of subsidised fossil fuels.

Despite the recent boost in investments in the alternative energy sector, Jordan will not see the production of electricity from oil shale before 2016, while the first large-scale renewable energy project, a 90-megawatt wind farm south of Shobak, is not expected to come online before 2014.

Observers say uncertainty over Egyptian gas has elevated energy from a policy concern to an issue of national security for Jordan, which currently imports 98 per cent of its energy needs at a cost of 23 per cent of the gross domestic product.

Israel-Jordan ties threatened

Aug. 10, 2011


JERUSALEM, Aug. 10 (UPI) -- Anti-normalization elements in Jordan are threatening economic and diplomatic ties with Israel, sources told The Jerusalem Post.

The Arab Spring, the stalemate in peace negotiations with the Palestinians and Palestinian efforts to gain statehood recognition in the United Nations in September are behind the upswing, sources told the paper.

Examples of the anti-Israel sentiment in the Hashemite Kingdom in recent months include the decision of a Jordanian insurance company to stop covering the cars of Israeli Embassy personnel in Amman, the newspaper said.

The company said it was forced to stop working with the embassy because of the increasing pressure from anti-normalization factions.

The sources also noted the Jordanian press has stepped up anti-Israel rhetoric, citing an article this week on the Amman news service Web site that referred to Israeli Prime Minister Binyamin Netanyahu as a criminal, and described Israel as a "snake" and Zionists as "despicable obnoxious group of people," sources told the Post.

There has also been a marked decrease in agricultural products exported to Jordan since the beginning of the year due to pressure on Jordanian importers, the sources said. Even Jordanians who sell olives to Israel have been subjected to harassment and told the olives sent to Israel are being used to make olive oil for export to Europe for further profit, the paper said.