Another gas asset switching back to online mode in the wake of Israel-Iran ceasefire

Chevron Mediterranean, a subsidiary of the U.S.-headquartered Chevron, has received the green light to restore production from its giant natural gas field off the coast of Israel, as the dust continues to settle over the U.S.-arranged Israel-Iran ceasefire deal in the Middle East.

Both Israel and Iran were forced to shut down some of their energy assets once the spark of hostilities reignited between the two countries in the aftermath of the former’s air strikes against the latter, which started on June 13, 2025. 

Israel’s affected portfolio encompasses the Leviathan reservoir, where gas production came to an end after a security recommendation from Israel’s Minister of Energy and Infrastructures, which instructed Chevron, as the operator of the field, to stop the Leviathan platform’s operations until further notice from the Israeli authorities.

Following the receipt of notice from Israel’s Ministry of Energy and Infrastructure, instructing the safe resumption of production and operations at Energean’s FPSO Energean Power at the Karish field, a notice for the restart of the Leviathan platform was also revealed, following the U.S. intervention to implement a ceasefire between the two countries.

As a result, the U.S. oil major and its Leviathan partners, NewMed Energy and Ratio Energies, are working on restarting the platform and resuming regular production from the reservoir within a few hours. This comes after the partners approved the budget for expanding the existing infrastructure to include a floating LNG (FLNG) facility, expected to produce 4.6 million tons of LNG per year. 

The partnership’s initial estimate, based, among other things, on the forecasted production from the Leviathan reservoir and the Karish lease, highlights that the production halt resulted in a loss of income from the sale of natural gas and condensate – gross, before royalties – and income from overriding royalties from the lease in the total of nearly $38.8 million.

NewMed underlined: “According to the gas sale agreements, the partners in the Leviathan project, including the partnership, issued a notice to customers invoking the force majeure clause in respect of the period in which production was halted as aforesaid.

“The partnership intends to explore the possibility of receiving compensation from the state in connection with the halting of the gas production, although at this stage there is no certainty as to receipt of such compensation and the amount thereof.”

The Leviathan expansion and the future FLNG facility are seen as necessary for the potential LNG deliveries from the Leviathan reservoir to Germany under the memorandum of understanding (MoU), which NewMed and Uniper signed.

Located around 130 kilometers off the shores of Haifa, Leviathan is said to be the largest natural gas reservoir in the Mediterranean and the biggest energy project in Israel’s history, with 22.9 trillion cubic feet (tcf) of recoverable gas believed to be at its disposal.