BP, Emirati oil giant looking to buy half of Israeli gas firm

British energy firm BP and the UAE state oil company, Abu Dhabi National Oil Company (ADNOC), have offered to purchase 50 percent of Israel’s offshore gas producer, NewMed Energy.

The “non-binding indicative offer” was received on 27 March, NewMed Energy announced, adding that it has appointed an audit committee to review the agreement.

The purchase would involve acquiring the company’s ‘free floating shares,’ making it private. NewMed Energy holds 45 percent of Israel’s Leviathan offshore gas field. The agreement marks London and Abu Dhabi’s entry into the growing Israeli energy sector.

“Together with ADNOC, [BP] has made a non-binding offer to take NewMed Energy private through an acquisition of the free float and a partial acquisition of [Israeli holding firm] Delek’s stake, which would result in BP and ADNOC holding 50 percent of NewMed Energy,” BP said in a statement.

This is a “significant first step” in BP and ADNOC’s move “to form a new joint venture that will be focused on gas development in international areas of mutual interest, including the East Mediterranean,” the British energy firm added.

According to NewMed Energy’s CEO, Yossi Abu, this offer is “the result of the warm relationships and bridges we have built in recent years with the energy companies working in the region.”

Economic and energy cooperation between Abu Dhabi and Tel Aviv has been on the rise since the Gulf state normalized relations with Israel as part of the 2020 Abraham Accords. In 2021, it was agreed that Emirati oil company Mubadala Petroleum would buy a 22 percent stake in the Israeli Tamar offshore gas field.

Just two days ago, the UAE and Israel signed a free trade agreement which will remove or reduce tariffs on 96 percent of commodities traded between them.

In the aftermath of the highly discriminatory comments made by Israeli Finance Minister Bezalel Smotrich, the UAE has attempted to follow in the steps of other regional countries in condemning the violent and extremist rhetoric of Israel’s government. Last week, the UAE Foreign Ministry ordered its envoy in Israel not to meet with any Israeli officials.

However, these recent trade and energy deals signify that Emirati-Israeli relations remain strong, despite the new Israeli government’s genocidal tendencies toward Palestinians.