Last update - 00:00 21/10/2007
Ya'alon: British Gas natural gas deal in Gaza will finance terror
By Avi Bar-Eli
The public disagreements between former Israel Defense Forces chief of staff Moshe Ya'alon and the politicians running the country have reached a new level, and have put the spotlight on one of the most sensitive affairs in the Israeli economy: the negotiations with BG (British Gas) over the purchase of natural gas from the undersea field off the Gaza coast.
In an article written by Ya'alon that appeared Friday on the Web site of the Jerusalem Center for Public Affairs (JCPA), he accuses the Security Cabinet of not ordering military action in Gaza so that it would not damage the chances of reaching a deal with BG.
The Prime Minister's Office declined to respond to Ya'alon's comments.
The rights to the offshore gas field belong to BG (60 percent); the Lebanese construction and infrastructure company CCC (30 percent); and the investment fund of the Palestinian Authority (10 percent).
The Gaza Marine field was discovered in 2000 after years of gas and oil prospecting in the area, and the 1.4 trillion cubic feet of gas is worth an estimated $4 billion.
In a highly controversial move, then-prime minister Ehud Barak gave up Israel's rights to the natural gas field and gave them to the Palestinian Authority for free.
According to Ya'alon, the British government and Tony Blair pressured former prime ministers Barak and Ariel Sharon to agree to a deal, but Mossad head Meir Dagan objected to such an agreement, fearing the proceeds from selling the natural gas to Israel would not benefit the Palestinian public, but instead would finance more terror attacks against Israel.
The negotiations continued for years, due to both the problems of devising payment methods to prevent the transfer of the proceeds to terror organizations, as well as disagreements over the price of the gas.
More recently, the negotiations have been further delayed by a petition to the High Court of Justice by rival natural gas supplier Tethys Sea. Tethys Sea is asking the court to forbid an agreement between the state and BG without the publication of a tender.
Despite Sharon's refusal to agree to such a deal, Prime Minister Ehud Olmert resurrected the negotiations with BG, and invested quite a lot of energy in trying to reach a deal over the purchase of the gas. This comes despite the increased terror threat from Gaza after the Hamas takeover, said Ya'alon.
"The prospect of an Israeli gas purchase may have played a role in influencing the Olmert cabinet to avoid ordering a major IDF ground operation in Gaza, even though there have been at least 1,000 rocket and mortar attacks against southern Israel since the Hamas takeover of Gaza in June 2007," he wrote.
He further warned that organizations associated with the international Islamist fundamentalist terror network would be highly motivated to attack British Gas' production facilities off the Gaza shore, and said he expected Hamas would increase its attempts to damage the Ashkelon power plant as the negotiations with BG advanced.
Ya'alon further claimed that since 2002, Israel has not held a serious, thorough discussion of the security implications of a natural gas deal with BG.
With his controversial statements, Ya'alon is continuing to make headlines.
"The British government seems to have pinned much of its Middle East policy on the successful outcome of British Gas negotiations with Israel. A September 18, 2007, report in the Arabic al-Quds newspaper noted that the British government views Gaza's natural gas reserves as central to 10 Downing Street's 'economic road map' for the Middle East. Tony Blair's position, first as prime minister and now as the very active Quartet envoy for Palestinian Economic Development, has been that the Palestinian Authority's share of the gas sale proceeds, which could reach well more than $1 billion, could serve as the economic fuel to jump-start the Palestinian economy and advance the peace process," wrote Ya'alon.
He further emphasizes that all the plans to bypass Hamas in Gaza are futile: "British officials have expressed confidence that the gas proceeds can bypass Hamas and benefit the Palestinian public by being deposited and monitored in international bank accounts. Israel also has proposed paying for the gas in goods and services. However, these assessments are mistaken. A gas transaction with the Palestinian Authority will, by definition, involve Hamas. Hamas will either benefit from the royalties, or it will sabotage the project and launch attacks against Fatah, the gas installations, Israel - or all three."
The Jerusalem Center for Public Affairs, an independent policy institution, was founded in 1976 by the late Prof. Daniel J. Elazar, and currently is headed by Israel's former UN ambassador, Dr. Dore Gold.
The JCPA states "it approaches its work without preconceptions to generate new ideas, which may prove vital in Israel's fight for survival."
"Israel must consider whether it can afford to be dependant on the Palestinians for such a critical energy asset as natural gas. If Israel becomes the Palestinians' main gas customer in a multi-year agreement, the PA or Palestinian terror groups could use the continued supply of gas as a lever to pressure Israel to make additional concessions and "gestures" as part of political negotiations. More significantly, the Palestinians could threaten to cut off the natural gas supply to Israel to prevent the IDF from responding to terror attacks and other threats emanating from Gaza or the West Bank," wrote Yaalon in his essay.
He concludes that while Israel needs additional energy resources, including natural gas reserves, "funneling $1 billion into local or international bank accounts on behalf of the Palestinian Authority would be tantamount to Israel bankrolling terror against itself."
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