The Israeli government has approved a plan to expand natural gas production at the Leviathan field in the eastern Mediterranean, enabling a significant increase in gas exports to Egypt over the coming decades.
Leviathan, Israel’s largest offshore gas field, is operated by a consortium led by Chevron, alongside NewMed Energy and Ratio Energies. The newly approved framework allows for higher extraction volumes, making additional gas available for export beyond Israel’s domestic consumption needs.
On December 17, Prime Minister Benjamin Netanyahu announced the decision at a televised press conference, describing it as the largest gas export agreement in the country’s history. According to the government, the total value of the expanded arrangement is estimated at NIS 112 billion, with approximately NIS 58 billion expected to flow to the state treasury through taxes and royalties over time.
Expansion of existing export arrangements
The decision builds on an existing gas export agreement signed in 2019, under which Israel committed to supplying up to 60 billion cubic metres (bcm) of natural gas to Egypt by the early 2030s. The revised framework increases the total contracted volume to 130 bcm.
The additional volumes are structured in two phases: an initial increase of 20 bcm, followed by a further 110 bcm. As a result, the projected duration of pipeline gas exports to Egypt is extended into the early 2040s, with the precise end date dependent on Egypt’s capacity to absorb the contracted volumes.
NewMed Energy, which holds a 45.34 per cent stake in Leviathan, announced in August that it had reached an agreement with Blue Ocean Energy to expand the existing supply contract. Government approval was required to proceed, as the increase involves reallocating a larger share of Israel’s offshore gas reserves for export markets.
Egypt has said that Cairo’s $35bn natural gas deal with Israel is a “purely commercial” arrangement and that there are no “political dimensions” to the deal.
🔗: https://t.co/tyzAQ6j9qn pic.twitter.com/k4mJgqfgMm
— Al Jazeera English (@AJEnglish) December 18, 2025
Infrastructure developments
To support higher export volumes, new infrastructure investments are planned. In September, Chevron signed an agreement with Israel Natural Gas Lines (INGL), the state-owned pipeline operator, to advance construction of the Nitzana natural gas pipeline. The pipeline is intended to increase transmission capacity between Israel and Egypt, facilitating long-term gas flows between the two countries.
Israel currently exports natural gas to Egypt primarily via pipeline, where part of the gas is consumed domestically and part is liquefied at Egyptian LNG facilities for re-export to international markets.
Domestic and regional considerations
The approval follows internal deliberations over the balance between export commitments and long-term domestic supply security. Israel’s natural gas policy requires government authorisation before large volumes of gas reserves can be allocated for export, reflecting concerns about future energy availability and price stability within the domestic market.
Regionally, the expansion takes place against a complex geopolitical backdrop. Energy cooperation between Israel and Egypt has become a central feature of eastern Mediterranean gas development over the past decade, alongside broader regional initiatives involving Cyprus, Greece and other partners.
At the same time, the project intersects with wider discussions involving the United States and regional stakeholders on energy security, infrastructure development and market access in the eastern Mediterranean.
🇮🇱Israel doubles down on regional energy leadership
approving a historic expansion of gas exports to Egypt
🔹 130 bcm total exports
🔹 $35 billion of value
🔹 2040+ timeline extension
Could Netanyahu desecuritise Israel's gas strategy?Read the analysis
📜https://t.co/swVkN5KOjI— Francesco Sassi (@Frank_Stones) December 22, 2025
Outlook
With government approval now in place, the Leviathan expansion is expected to proceed subject to final investment decisions, regulatory clearances and construction timelines. If implemented as planned, the project would consolidate Israel’s role as a key natural gas supplier to Egypt and extend the lifespan of bilateral energy trade well into the next two decades.
Further details on production capacity, export schedules and infrastructure financing are expected to be clarified as the project moves into its next phase.