meed-logo

line1 line2 line3
SIGN IN / REGISTER

Gaza conflict casts shadow over energy projects

9 October 2023

Analysis
Wil Crisp
Oil & gas reporter

Israel’s declaration of war against Hamas has increased uncertainty over planned oil and gas projects in the region and could lead to long delays and even the cancellation of some significant projects.

The projects at risk include oil and gas projects off the coast of Gaza, in Cyprus, Egypt and Lebanon.

One project likely to see severe delays or cancellation is the planned development of the Gaza Marine gas field.

In June, the Israeli government issued preliminary approval to develop the Gaza Marine project, 30 kilometres off the coast of Gaza, the Palestinian enclave controlled by Hamas.

Talks to push forward the development of the Gaza Marine gas field have been mediated by Egypt and attended by officials from both the Palestinian Authority and Israel.

The Gaza Marine field is estimated to hold more than 1 trillion cubic feet of natural gas.

The Gaza Marine field was discovered at the end of the 1990s and development has already been delayed several times due to conflict between Israel and Palestine.

Although the field is not large compared to others discovered in the Mediterranean, it is expected to generate about $7bn in revenues if developed.

The field is expected to produce 1.5 billion cubic metres of gas a year over 20 years.

Lebanese oil and gas

There is also potential for the conflict between Israel and Hamas to disrupt offshore oil and gas projects in Lebanese waters near the Israeli border.

Israel conducted artillery strikes across its UN-patrolled border with Lebanon after Hezbollah launched guided missiles and artillery shells in the contested Shebaa Farms border area on 8 October.

The rapid deterioration in relations between the two countries could awaken the conflict over shared maritime boundaries that was seemingly resolved last year, allowing Lebanon to start exploratory drilling for oil in formerly disputed territories that lie close to Israeli waters.

In August, a drilling rig arrived in Lebanon’s Block 9 to begin oil and gas exploration.

The exploration is being conducted in Lebanon’s Block 9 by a consortium led by France’s TotalEnergies. It includes the Italian oil company Eni and state-owned QatarEnergy.

Qatar Energy replaced Russian company Novatek, which withdrew from the Lebanese market in September.

The drilling became possible after a deal in 2022 that delineated the Lebanon-Israel maritime border for the first time, despite Beirut still considering itself at war with its neighbour and laws barring contact with Israeli officials.

Block 9 lies mostly in Lebanese waters, but a segment lies south of the newly delineated border.

As part of the deal, signed on 27 October 2022, a mechanism for the consortium to exploit possible discoveries that extend south from Block 9 was established, setting up a royalties system for Israel while the exploitation would be on behalf of Lebanon.

Experts have argued that the absence of specific criteria for profit distribution is one of the biggest loopholes in the deal in the event of cross-border deposits being identified.

Aphrodite gas field

The deterioration in relations between Israel and its Arab neighbours has created increased uncertainty over plans for a subsea pipeline connecting the Aphrodite natural gas field, located off the coast of Cyprus, to Egypt.

In May this year, partners in the Aphrodite natural gas field, which include Israel’s NewMed Energy, announced they were seeking approval from the Cypriot government to build the subsea pipeline that would link to an existing processing and production facility in Egypt.

At the time, Israel’s NewMed Energy, formerly Delek Drilling (part of Yitzhak Tshuva’s Delek Group), which owns a 30 per cent stake in the Aphrodite field, said it had presented the Cypriot government with an updated plan for the development of the reservoir, including natural gas processing and production.

The other partners in the Aphrodite gas field, which holds an estimated 124 billion cubic metres of gas, are US energy giant Chevron and Shell, each owning a 35 per cent share.

The Aphrodite gas field was discovered by the A-1 well in September 2011 and is estimated to hold 4.5 trillion cubic feet of recoverable reserves.

Israel claims that part of the field lies in Israeli waters. Although talks have made headway over recent years, the dispute has not yet been completely settled with a signed agreement.

A formal resolution to the border dispute with Israel will be needed to gain significant ground on the project to develop the Aphrodite field.

If the progress towards the resolution is overturned in the wake of the latest round of conflict between Hamas and Israel, then that would be a major setback to Cyprus’ plans to export gas to Europe.

https://image.digitalinsightresearch.in/uploads/NewsArticle/11202874/main.gif
Wil Crisp

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Dubai opens prequalification for Jebel Ali STP expansion

    13 May 2026

     

    Dubai Municipality has issued a request for qualifications for the Jebel Ali sewerage treatment plant (STP) expansion – phase 3 project.

    The DS150/3 project will be delivered under a public-private partnership (PPP) model on a design, build, finance, own, operate and transfer basis.

    The project involves the development of a new water resource recovery facility with an ultimate treatment capacity of up to 1 million cubic metres a day (cm/d).

    It is being procured through Dubai Municipality’s Sewerage and Recycled Water Projects Department and will be delivered through a two-stage operational approach over a 30-year concession period.

    The bid submission deadline is 18 June.

    UK-headquartered Deloitte is acting as financial adviser, Aecom as technical adviser and CMS as legal adviser.

    Dubai Municipality said the project will also include additional land uses and community-focused amenities as part of broader sustainability and urban integration objectives.

    Phase one and two expansion

    In April, the deadline was extended for contractors to submit bids for an engineering, procurement and construction (EPC) contract covering the expansion of the Jebel Ali STP phases one and two.

    Located on a 670-hectare site in Jebel Ali, the original wastewater facility has a treatment capacity of about 675,000 cm/d following the completion of phase two in 2019, combining approximately 300,000 cm/d from phase one and 375,000 cm/d from phase two.

    The upgraded facility will be capable of treating an additional sewage flow of 100,000 cm/d, with the expansion estimated to cost $300m.

    The new bid submission deadline is 11 June.

    UK-headquartered KPMG and UAE-based Tribe Infrastructure are serving as financial advisers on the project.

    > Be recognised among the best in the industry at the MEED Projects Awards 2026 …

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16812872/main.jpg
    Mark Dowdall
  • Iraq LNG project delayed until next year

    13 May 2026

    Register for MEED’s 14-day trial access 

    Iraq’s first liquefied natural gas (LNG) import terminal, which has an estimated project value of $450m, is now expected to become operational in 2027 due to delays caused by the regional war and disruption to shipping through the Strait of Hormuz.

    Work on jetty reinforcement and fixed terminal infrastructure at the Port of Khor Al-Zubair has been delayed, according to a statement from US-based Excelerate Energy, which is contracted to develop the facility.

    In its statement, the company said: “We are revising our full-year guidance to reflect the delayed startup of our Iraq terminal due to the ongoing conflict in the Middle East.”

    It added: “The Iraq project fundamentals remain unchanged. Looking ahead, we continue to have confidence in our sequenced earnings growth through 2028.”

    In October 2025, Excelerate signed a definitive commercial agreement with a subsidiary of Iraq’s Ministry of Electricity for the development of the country’s first LNG import terminal.

    The integrated project includes a five-year agreement for regasification services and LNG supply, with extension options, and a minimum contracted offtake of 250 million standard cubic feet a day (cf/d).

    Excelerate said: “Jetty reinforcement and construction of the fixed terminal infrastructure have been delayed temporarily due to the conflict in the Middle East and the terminal is no longer expected to commence operations in the third quarter of 2026 as previously disclosed.

    “Project startup is now expected in 2027. The long-term fundamentals supporting the project remain unchanged, driven by chronic power shortages and limited domestic gas processing capacity in Iraq.

    “Current conditions further reinforce the country’s need for reliable and scalable LNG import infrastructure and construction will resume as conditions allow.”

    Earlier this year, Iraq’s Ministry of Electricity said that the terminal was on track to come online on 1 June, ahead of expected gas shortages during the summer months.

    Then, in late April, the ministry said the project had been delayed by several months and was expected to come online in August at the earliest.

    Although Iraq is Opec’s second-largest oil producer after Saudi Arabia, it is a net natural gas importer because its lack of infrastructure investment has meant that, until 2023, it flared roughly half of the estimated 3.12 billion cf/d of gas produced in association with crude oil.

    Iraq’s reliance on flaring associated gas instead of gathering and processing it has prevented the country from fully realising its potential as a gas producer and forced the Iraqi government to rely on costly gas and electricity imports from Iran.

    READ THE MAY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Global energy sector forced to recalibrate; Conflict hits debt issuance and listings activity; UAE’s non-oil sector faces unclear recovery period amid disruption.

    Distributed to senior decision-makers in the region and around the world, the May 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16803348/main.jpg
    Wil Crisp
  • Algeria turns the GCC oil crisis into an economic opportunity

    13 May 2026

    Commentary
    Wil Crisp
    Oil & gas reporter

    Algeria’s state-owned oil and gas company, Sonatrach, is taking advantage of concerns about global gas and crude supplies to sign deals and push ahead with major upstream projects.

    In recent weeks, the country has launched an oil and gas licensing round, taken steps to boost crude production in the short term and awarded a $1.1bn oil and gas field development project.

    This comes as shipping remains disrupted through the Strait of Hormuz, a key global oil and gas supply route. The disruption began after the US and Israel attacked Iran on 28 February 2026, triggering a regional war.

    Algeria’s ramp-up in activity puts it in a stronger position to benefit from higher global energy prices than neighbouring Libya, despite Libya holding Africa’s largest proven oil reserves.

    Libya challenges

    In Libya, officials have sought to advance oil and gas projects, but the business environment remains challenging due to recurring violence and deep political divisions.

    Last month, Libya’s rival legislative bodies approved a unified state budget for the first time in more than 13 years. The Central Bank of Libya confirmed on 11 April that both chambers had endorsed the budget, calling it a key step towards restoring financial stability after prolonged division.

    Contractors expected the agreement to accelerate project activity, but so far the deal has yet to translate into meaningful progress on the ground. Earlier this month, MEED reported that Libya’s state-owned National Oil Corporation (NOC) had not yet provided subsidiaries with details of their funding allocations under the new budget.

    Libya’s downstream sector was also disrupted this month by a fresh outbreak of violence. On 8 May, military clashes damaged buildings and vehicles, and forced the country’s largest operating refinery and a nearby oil port to shut for two days. On 10 May, Azzawiya Oil Refining Company, operator of the Zawiya facility, said it had lifted the state of emergency, allowing work to resume.

    Algeria momentum

    While Libya has struggled to capitalise on the current period of higher oil and gas prices, Algeria has significantly increased activity across its hydrocarbons sector.

    Last month, Algeria launched a new bid round offering seven exploration blocks to international companies. The round was launched by the National Agency for the Valorisation of Hydrocarbon Resources (Alnaft), which regulates the upstream sector. The blocks are located in Ouargla, Illizi, Touggourt and El-Bayadh.

    In parallel, Algeria is implementing short-term measures to raise output. On 3 May, the Ministry of Oil & Gas said the country plans to increase average production by 6,000 barrels a day in June.

    Algeria is also pursuing regional export opportunities. Earlier this month, officials signed a framework agreement to enable crude supplies from Algeria to Egypt.

    Turkiye has also announced plans to renew and expand its liquefied natural gas (LNG) agreement with Algeria. Turkiye’s Energy and Natural Resources Minister Alparslan Bayraktar said on 8 May that annual volumes could rise to 6.5 billion cubic metres, up from the current 4.4 billion cubic metres a year. The existing agreement is due to expire in September 2027.

    Another sign of momentum is the award of a $1.1bn contract for phase two of the Hassi Bir Rekaiz oil and gas field development. The contract was signed by Egypt’s Petrojet and Italian engineering and contracting company Arkad. Petrojet’s share is estimated at about $600m and Arkad’s at about $500m. The client is Groupement HBR, a joint venture of Sonatrach and Thailand’s PTTEP.

    Overall, while Libya continues to face obstacles to building sustained momentum in its oil and gas sector, Algeria is pursuing multiple initiatives that are likely to deliver economic benefits in the short, medium and long term.

    READ THE MAY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Global energy sector forced to recalibrate; Conflict hits debt issuance and listings activity; UAE’s non-oil sector faces unclear recovery period amid disruption.

    Distributed to senior decision-makers in the region and around the world, the May 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16803345/main4150.jpg
    Wil Crisp
  • Chinese-Saudi joint venture to build $566m copper plant

    12 May 2026

    Register for MEED’s 14-day trial access 

    Saudi Arabia-based industrial investment company Rawas and China’s Zhejiang Hailiang Company have signed a joint-venture agreement to establish a copper products manufacturing plant in the kingdom.

    The joint venture, in which Zhejiang Hailiang will hold 51% and Rawas 49%, plans to invest about $566m in the facility, which will be built near Dammam port in Saudi Arabia’s Eastern Province.

    The factory will be developed in two phases, with total production capacity projected at 150,000 tonnes a year (t/y). This includes 30,000 t/y of copper tubes, 20,000 t/y of copper busbars, 50,000 t/y of refined recycled copper and 50,000 t/y of copper foil.

    “The project will fully leverage Saudi Arabia’s local copper ore resources, energy cost advantages and regional policy incentives to serve markets across the Middle East, Europe and Africa,” the partners said in their statement.

    Shenzhen Stock Exchange-listed Zhejiang Hailiang is a subsidiary of Hailiang Group, one of the world’s largest copper pipe manufacturers and exporters.

    Rawas is based in Riyadh. Obeikan Investment Group and Al-Khorayef Group are among its founding shareholders, while other investors include Al-Muhaidib Group and Mohammed Abunayyan Investment Group.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16799512/main.jpg
    Indrajit Sen
  • Dubai Holding increases its shareholding in Emaar

    12 May 2026

    Register for MEED’s 14-day trial access 

    Dubai Holding and the Investment Corporation of Dubai (ICD) have completed a transaction under which Dubai Holding acquired a 22.27% equity stake in the private real estate developer Emaar Properties from ICD.

    Following the transaction, Dubai Holding’s total shareholding in Emaar Properties has risen to 29.73%, making it the company’s largest shareholder.

    Listed on the Dubai Financial Market, Emaar Properties is among the region’s leading real estate developers, with a portfolio spanning residential, commercial, hospitality and retail assets. The firm has a presence across the Middle East, North Africa, Asia and Europe.

    In a statement, Dubai Holding said that the acquisition is a strategic investment that underscores Dubai Holding’s confidence in Emaar Properties’ market position, asset quality and long-term growth outlook, as well as the resilience of Dubai’s economy and real estate sector.

    Dubai Holding’s latest investment follows the incorporation of local real estate bodies Nakheel and Meydan into the Dubai Holding Group in 2024.

    Since its establishment in 2004, Dubai Holding Group has created a portfolio of companies, including Jumeirah Group, Dubai Properties and Tecom Group. Tecom Group owns and operates several clusters in Dubai, including Dubai Internet City and Dubai Media City.

    Nakheel and Meydan are among Dubai’s major real estate developers, with developments including Palm Jumeirah, Palm Jebel Ali, Meydan One, Tilal Al-Furjan, Mohammed Bin Rashid City and Dubai Islands.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16799031/main.jpg
    Yasir Iqbal