BP, ADNOC make bid for Eastern Mediterranean natural gas

British energy company BP said Tuesday it was working with a counterpart in Abu Dhabi to form a joint venture that would capitalize on the natural gas deposits off the Israeli coast of the Mediterranean Sea.

BP and the Abu Dhabi National Oil Co., a regional oil giant known otherwise as ADNOC, offered $2 billion to take on a 50% stake in Israeli offshore gas producer NewMed Energy. The stake would be acquired from Delek Group.

"BP and ADNOC intend to form a new joint venture that will be focused on gas development in international areas of mutual interest including the East Mediterranean," the companies said in a joint statement.

NewMed is a major shareholder in the Leviathan natural gas field off the coast of Israel. Much of the hundreds of billions of cubic feet of gas pulled each year from Leviathan goes to the domestic Israeli market and piped to Jordan and Egypt.

Natural gas has grown in geopolitical importance since Russian military forces invaded Ukraine in February of last year. Russia was once the main supplier of natural gas to the European economy and Ukraine hosts a dense network of Soviet-era pipelines feeding the regional economy.

Sanctions targeting Russian natural resources, and sabotage on its Nord Stream pipeline last year, left Europe scrambling for alternatives. The effort to take on shares of NewMed Energy, meanwhile, represents a growing interest in the region.

"This proposed transaction with NewMed Energy would be a significant first step in establishing this dynamic joint venture together with ADNOC," their statement read.

For BP, meanwhile, its consistent with a renewed focus on oil and natural gas, which the company said are the fuels needed now while clean energy technologies develop. Some $8 billion will go to new oil and natural gas production over the next seven years.