Israel Grants Offshore Gas Licences to BP, Socar, and NewMed to Expand Energy Supply

Israel has awarded new natural gas exploration licences to BP, Azerbaijan’s state-owned Socar, and Israel’s NewMed Energy as part of its efforts to expand domestic gas reserves and strengthen its position as a regional energy supplier. The licences cover an offshore area known as Cluster I, located in the northern part of Israel’s economic waters in the Mediterranean Sea.

The exploration consortium, in which each company will hold an equal stake, is set to begin seismic and geological surveys to assess the potential for natural gas extraction. Socar will serve as the operator of the exploration project, marking its entry into Israel’s energy market, while BP is participating in the country’s natural gas sector for the first time. NewMed, already a key player in Israel’s gas industry, holds a significant stake in the Leviathan field, the country’s largest offshore natural gas reservoir.

Energy Minister Eli Cohen emphasized the strategic importance of natural gas in bolstering Israel’s economic and diplomatic standing. He stated that expanding gas production remains a priority, both for domestic energy needs and export commitments. The Energy Ministry also announced plans for a fifth bidding round later this year, aiming to grant additional exploration licences and attract more global investors to the country’s natural gas sector.

The gas-rich Eastern Mediterranean has drawn significant international attention in recent years, particularly as European nations seek alternatives to Russian gas supplies. Israel has positioned itself as a reliable supplier, with exports to Egypt and Jordan increasing by 13.4% in 2024. The country has also committed to expanding its natural gas exports to Europe, reinforcing its role as a critical energy hub in the region.

Natural gas exploration and production require long-term investment and advanced technology, with initial surveys and assessments often taking years before drilling begins. However, if successful, these newly awarded licences could significantly contribute to Israel’s energy security and economic growth. The involvement of BP and Socar brings global expertise to the venture, strengthening Israel’s efforts to maximize its natural gas potential and enhance its role in the international energy market.

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