Haifa Sitting on Potential Gunpowder Keg

In fact there are multiple deadly hazards in the Haifa bay area; the giant ammonia tank is just one.

About two weeks ago in the small Texas town of West, an explosion at a fertilizer plant where large quantities of the explosive anhydrous ammonia were reportedly stored rocked a wide area. The blast wrecked a number of nearby homes and shattered windows as far as 11 kilometers away. Debris from the blast was scattered over a radius of dozens of kilometers. At least 15 people were killed and about 200 injured.

As far away as Israel, the event sparked public debate. The exact cause of the blast in Texas is still to be determined, but attention was drawn to the fact, for example, that Haifa Chemicals maintains an ammonia tank right in the middle of the Haifa metropolitan area.

That tank squats there despite repeated reports that an ammonia explosion would kill thousands.

The Texas blast prompted a call by Haifa Mayor Yona Yahav and environmental groups to move that ammonia tank. For his part, Israel's new environmental protection minister, Amir Peretz, quickly announced that he would expedite the relocation of the tank to Israel's south.

But the Haifa ammonia tank is by no means the only hazard in the Haifa Bay area.

This area of heavy industry in the heart of the Haifa metropolitan area is also, for example, where stocks of bromine awaiting export are kept. There are also ethylene tanks in the area and the Haifa suburb of Kiryat Ata even has a major cooking gas storage site.

All these facilities pose the risk of fire and explosion, and Haifa is much larger and more densely populated than the small Texas town of West. These industries located where they did decades ago due to the presence of the industrial anchor in the area, Oil Refineries (commonly known by its Hebrew acronym, Bazan). And Oil Refineries itself stores thousands of tons of fuel and hazardous materials.

The refinery in Haifa was built by British authorities between 1938 and 1944 when they ruled the country, to refine oil discovered in Iraq. The construction of an oil pipeline that ended in Haifa at the refining facility made it possible for ships from the British Empire plying the Mediterranean and Europe to be supplied with oil, which was particularly important during World War II. With the departure of the British from the country in 1948, the refineries were transferred to Israel's control. The Israeli government formally acquired them in 1958. Currently they are owned by the Israel Corporation, which has a 37% stake, while David Federman's firm, Israel Petrochemical Enterprises, has 31%. The balance is held by members of the public.

For years, the Haifa refinery was a major cause of air pollution in the Haifa Bay area, and higher than average rates of cancer and asthma were also detected among the population there. The plant has produced tons of toxic sludge, a pollution problem that just began to be addressed recently. Despite the plant's major investment in abating the air pollution problem and a transition to the use of natural gas, the refineries remained a sanitation and safety hazard. Despite it all, however, the refineries never faced a threat of closure and their continued existence never became a public issue. Furthermore, the refinery management has sought planning approval to at least triple the built-up area on which the refinery is situated. Opposition groups objected, however, and the question was raised as to whether a small country like Israel even needs its own refineries.

Oil Refineries response was clear. "Israel recognizes the Israeli refinery industry as one that is essential to its security and energy independence," the company said, but there are others who are calling for the issue to be thoroughly reexamined.

"The refineries were not built by Israel but rather by the British out of a sense that it was better to pollute Haifa than Scotland," said Dr. Brenda Shaffer from the University of Haifa's political science department. "They were built to refine oil from Iraq. Haifa was a very small city then, and the [British] Empire wasn't really interested in the quality of life of the natives of the colonies."

But Shaffer added that today the refineries could never have gotten approval to be built where they are, near centers of population. "Even in Azerbaijan, they moved an old refinery to [a location] an hour and a half from the capital, Baku," she says.

Shaffer's comments resonate even further in the face of the fact that just four months ago Oil Refineries dedicated a new so-called "hydrocracker" hydrogen fuel plant at the refinery, in which it invested about half a billion dollars. The plant uses byproducts left over from crude oil at the refinery, but critics say it will even increase the prospect of a disastrous accident at the site. Interestingly, however, most people sounded out on the subject, including pollution experts, acknowledge that Israel does indeed have a need for an independent refining capacity. They point to Israel's unique geopolitical situation, the Arab oil embargo of the 1970s and the prospect that the country could face fuel shortages in the event of a wartime siege.

Official recognition of the refineries as an essential industry has led to limitations on their ownership structure and emergency provisions that would require a specific mix of fuel production for the military establishment. Old-timers at Oil Refineries note that a refinery in Ashdod, which was ultimately privatized and acquired by the Paz Oil Co. group, altered production during the 1973 Yom Kippur War so it could provide jet fuel to the Israel Air Force.

Theoretically, Israel could import refined fuel from Europe, where refineries are hungry for business due to the decline in demand. The Mediterranean is also full of brokers who trade in refined oil products on the spot market. In addition, the argument could be made that if Israel faced a real international embargo, it would not be able to import the crude oil that the refineries need in any event.

"When questions are asked, the answer is always the military security justification," Shaffer said, "that we would be in a war, that we would be under siege, and that we would have to refine oil ourselves."

But the argument lacks logic, the University of Haifa political scientist says, noting herself that if ships can come and unload crude oil, they can instead unload refined fuel products. She also cites other countries' strategic energy reserves and says the law here does not require a similar stock.

Currently there is nothing preventing the import to the country of refined fuel products, but in practice just about the only refined fuel that is imported is liquefied petroleum gas for cooking. Gasoline station retailers buy their gasoline and diesel fuel from local refineries, although the Defense Ministry does on occasion buy refined fuel on the American spot market using U.S. foreign military assistance that Israel gets. But a former Energy and Water Resources Ministry official, Ehud Yehieli, points out that if Israel switched to importing refined fuel rather than refining it here, it would require huge logistical and infrastructure changes that he says Israel has no room for.

Furthermore, any cost-benefit analysis over shutting down the Haifa refineries would have to take into consideration the fact that the refineries and their subsidiaries employ about 1,500 people, many of them highly skilled, in addition to about 250 temporary workers. And thousands of others are employed at companies that do business with Oil Refineries.

"The petrochemical plants, which were controlled by the government for decades, caused a lot of environmental damage," the director general of the Haifa municipality, Shmuel Gantz, acknowledges. "But in recent years the industry has switched to using the best technology in the world, and that has led to a substantial reduction in air pollution. If there are technological solutions and it's possible to keep air pollution from leaving the confines of the plant site, there's no reason to close the refineries, because they provide a large financial benefit."

For her part, however, Ronit Piso, the executive director of the Public Health Coalition, an environmental group, has a different view. "All the Energy Ministry data show that demand for fuel will steadily decline until 2050, but [Oil Refineries] is planning more tanks there with a capacity of a million and a quarter cubic meters," she says. "Why do we need such big facilities? The hydrogen cracker and the fuel storage facility will enable Oil Refineries to export a lot more and the residents of Haifa will pay the price with their health."

Nir Kafri
Hagai Frid
Yaron Tsur Lavie