Israel and Egypt have agreed to build a pipeline to connect Israel's offshore Leviathan natural gas field to liquefied natural gas (LNG) terminals in northern Egypt, the Israeli minister said on Sunday.
The Palestinians also said they had signed an agreement with Egypt's energy minister, who visited Israel and the occupied West Bank, on developing a gas field off the coast of Gaza.
Israeli Energy Minister Yuval Steinitz hosted a meeting with Egypt's Tarek El Molla as both countries look for new ways to expand the development of east Mediterranean natural gas.
Israel's Leviathan field, located 130 km (80 miles) off Israel's coast, already supplies the Israeli domestic market and exports gas to Jordan and Egypt. Its shareholders include Chevron and Delek Drilling.
Leviathan's partners have been exploring options to expand the project, including a floating LNG facility or a subsea pipeline to link up with LNG terminals in Egypt that have been idled or run at less than their potential capacity.
Steinitz said the two governments were moving ahead with the pipeline plan and were working on a formal agreement.
"The two ministers agreed on the construction of (an) offshore gas pipeline from the Leviathan gas field to the liquefaction facilities in Egypt, in order to increase the gas exports to Europe through the liquefaction facilities in Egypt," Steinitz's office said in a statement.
Molla signed a memorandum of understanding for Egypt to help develop the Gaza Marine field with the project's two partners, the Palestine Investment Fund, the sovereign fund of the Palestinian Authority, and Consolidated Contractors Company.
Gaza Marine sits about 30 km (19 miles) off the Palestinian enclave's coast and is estimated to hold over 1 trillion cubic feet of natural gas.
(Reporting by Ari Rabinovitch in Jerusalem and Ali Sawafta in Ramallah; Editing by Edmund Blair)