Chevron is moving toward a final investment decision on expanding the Leviathan gas field offshore Israel, but the project cannot proceed until Israel signs off on a key export permit for sales to Egypt.

The company and its partners — NewMed Energy and Ratio — sealed a major supply agreement in August with Egyptian firm Blue Ocean. The deal, worth up to $35 billion, would be Israel’s largest gas export arrangement and relies on new pipelines to move the gas into Egypt.

Israel’s Energy Minister Eli Cohen has delayed approving the export authorization, saying Israel must first secure a favourable domestic gas price from the Leviathan partners. Without that price agreement, he has declined to endorse the export plans.

Chevron says it is close to finalizing its investment decision and is continuing discussions with all parties to create conditions that support long-term energy supply for Israel and the region. NewMed Energy has also expressed confidence that all approvals will be granted soon.

The delay has attracted attention in Washington. U.S. officials have urged Israel to advance the permit, viewing the deal as vital to easing Egypt’s ongoing energy shortages. U.S. Energy Secretary Chris Wright even cancelled a planned visit to Israel amid the disagreement.

Egypt has been grappling with a tight energy market and has spent heavily on imported LNG to meet demand. Gas from Leviathan — about 130 billion cubic metres through 2040 — would help reduce that pressure once the expansion goes ahead.

The upgrade, expected to cost around $2.4 billion, would extend Leviathan’s supply capacity well into the 2060s. Chevron holds 40% of the field, NewMed about 45%, and Ratio the remaining 15%.