Israel Orders Shutdown of Key Gas Field as Violence Rages

(Bloomberg) -- Israel ordered the shutdown of a major gas field run by Chevron Corp., citing safety concerns after violence erupted at the weekend. 

“Our top priority is the safety of our personnel, the communities in which we operate, the environment and our facilities,” Chevron said in an emailed statement. The company is still supplying customers in Israel and in the region from another major project called Leviathan, Chevron said. 

Gas discoveries in Israel over the last two decades have transformed the economy and turned it into an exporter of the fuel. Some of the supply goes to Egypt which in turn pushes it to Europe, just as the continent was seeking alternatives to Russian pipeline flows.

Tamar’s stoppage may result in lower onward shipments or even delays after Egypt planned to resume liquefied natural gas exports this month just ahead of the European winter. Gas prices in Europe were trading 11% higher.

In August, Israel said it would export more gas from Tamar to Egypt amid strengthening ties with its neighbor. Uncertainty looms over those plans as tensions in the Middle East rise after militant group Hamas launched attacks on Israel over the weekend, resulting in more than 1,100 dead as fighting continues for a third day.

The Tamar offshore field is located 24 kilometers (14.9 miles) west of Ashkelon, which lies north of the Gaza Strip. Gas is produced from six wells, with output from each at about 7.1 million to 8.5 million cubic meters a day, according to Chevron’s website.

(Updates with context from the third paragraph.)

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