begun. The project, which may eventually see $12 billion invested in oil and natural gas development, is potentially the largest direct foreign investment in Russia. Total recoverable reserves at the Sakhalin-1 area are estimated to be of oil and of natural gas. (DJ) July 15: The operator of Israel's Eilat-Ashkelon pipeline, a bi-directional pipeline linking the Mediterranean and the Red Sea, announces that the pipeline is operational. The pipeline, with a current capacity of , but a design capacity of , provides an alternative to the Suez Canal, as both Israeli ports can handle VLCCs, whereas Suez cannot. Perhaps even more importantly, with the new southerly flow, Russian crude on small tankers from the Bosporus will be able to eventually load onto VLCCs bound for East Asia. (Reuters) July 15: Hurricane Claudette hits the Texas coast about southwest of Houston. According to the U.S. Minerals Management Service, an estimated per day of natural gas had been shut in by Claudette, or about 18% of the Gulf's total gas output. Also, about of oil, or some 21% of the Gulf of Mexico's daily oil production, has been shut down. Production is quickly restored in the next few days. (Reuters) July 16: Italian oil and gas major Eni announces that it has begun exporting oil production from the giant Karachaganak field in Kazakhstan to the Novorossiysk terminal on the Black Sea. In addition, Eni said that it and its partners had completed pipelines and treatment facilities so that output from the oil field could grow by the end of the year to of oil equivalent per day from the current of oil equivalent per day. (DJ) July 16: Royal Dutch/Shell and Total successfully conclude the first deal with Saudi Arabia giving Western companies access to the Kingdom's hydrocarbon reserves since the nationalization of its petroleum industry. The agreement entails natural gas exploration and development across in Saudi Arabia's Empty Quarter. Previous efforts to open up Saudi Arabia's upstream natural gas sector, known as "Saudi Arabia's natural gas initiative" and the three "Core Ventures" were larger, with each estimated to be worth $10–$15 billion. The Core Ventures fell apart in June due to conflicts with foreign investors over financial terms. (Reuters) July 25: The first delivery of liquefied natural gas (LNG) since 1980 is made to the reactivated Cove Point LNG regasification plant in Maryland, as a tanker from Trinidad arrives carrying of