Jordan Signs $771 mn Deal to Buy Israeli Gas

Two Jordanian firms have signed a $771-million deal with U.S.-based Noble Energy to supply them with natural gas from an Israeli offshore field, local media reported on Thursday.

The Arab Potash and Jordan Bromine companies singed the agreement on Wednesday to obtain from Noble Energy and its Israeli partners 2 billion cubic meters (around 70 billion cubic feet) of gas from Israel's Tamar field for 15 years.

"The supply will start in the coming two years. The project will reduce the total production cost for Arab Potash by $357 million and for Jordan Bromine by $7.5 million in the first stage of the project," Al-Ghad newspaper quoted Arab Potash chairman Jamal Sarairah as saying.

Noble Energy owns 36 percent of the Tamar field in the eastern Mediterranean.

"The shift from heavy fuel to the less expensive and more eco-friendly natural gas is projected to produce total cost savings of 235 million dinars ($331 million, 242 million euros)," Arab Potash General Manager Brent Heimann was quoted as saying in the Jordan Times.

Energy-poor Jordan relied heavy on Egyptian gas supplies but a spate of attacks on the export pipeline through the restive Sinai Peninsula has repeatedly cut supplies to both the kingdom and Israel.

Egyptian gas covers 80 percent of electricity generation in Jordan, which imports 95 percent of its energy needs.

Officials have said the disruptions in gas supplies cost Jordan at least $1 million a day.