Wedoany.com Report-Aug. 25, Chevron Corp. and its partners have received approval from the Ministry of Energy and Infrastructures for a revised development plan to expand the Leviathan gas and condensate field offshore Israel. The Leviathan field, discovered in 2010 near Haifa and producing since December 2019, currently operates under Phase 1A with a capacity of about 12 billion cubic meters (Bcm) per year.

The revised plan for the expansion project would grow Leviathan's production capacity to around 812.24 Bcf a year.

The updated Phase 1B plan aims to raise production capacity to around 23 Bcm annually. The consortium may implement the plan in either one stage or two. Stage I would expand output to about 21 Bcm per year, while Stage II would add a further 2 Bcm. NewMed Energy LP, a major stakeholder, said in a regulatory filing that a final investment decision on Stage I is expected in the fourth quarter of 2025.

The approval was granted by the petroleum commissioner with several technical requirements, to be implemented under the guidance of the Natural Resources Administration at the Ministry of Energy. The commissioner noted: “In order to increase the pace of production above 2,100 MMscfd, upon performance of stage two of Phase 1B, it will be necessary to submit - and obtain the commissioner’s approval of - supporting documents according to the instructions of the professional team.”

He also stated that the Ministry’s current estimate of recoverable natural gas in the reservoir is approximately 19.4 trillion cubic feet (Tcf), or 551 Bcm, higher than the previous estimate of 17.6 Tcf. NewMed’s parallel estimate, based on a Netherland, Sewell & Associates report as of December 31, 2024, places the figure at about 22.3 Tcf (632 Bcm).

Stage I of Phase 1B includes drilling three new production wells, installing subsea systems, and expanding processing facilities on the existing platform. The gross cost is projected at $2.4 billion, with $505 million already approved by partners as of February 2025. Stage II would involve drilling additional wells, expanding subsea systems, and potentially laying a fourth pipeline, which would raise annual capacity to 23 Bcm.

Meanwhile, construction of a third pipeline under Phase 1A has been delayed due to regional instability following October 2023 events, with suspension announced in October 2024. The delay could last six months, affecting the planned mid-2025 completion.

In parallel, the consortium awaits an export permit for an amended supply agreement with Blue Ocean Energy, Egypt’s current buyer. The revised deal will add 130 Bcm of Leviathan gas deliveries, valued at about $35 billion. The increase will be phased: about 20 Bcm first, followed by 110 Bcm. The amendment also ties supply timing to progress on expansion projects, notably completion of Phase 1B Stage I and the Nitzana pipeline.

The Nitzana pipeline, approved in May 2023, will connect Israeli and Egyptian gas transmission systems, with completion expected in 2029.

Leviathan’s ownership structure consists of NewMed Energy (45.34%), Chevron through Chevron Mediterranean Ltd. (39.66%), and Ratio Energies LP (15%). The expansion reflects the partners’ strategy to boost production and secure long-term export growth.