Government ministers passed the long-awaited, controversial gas deal on Sunday afternoon, giving the Noble Energy and Delek Ltd. consortium the rights to the large gas fields they had discovered and begun to develop beneath the waters of the Mediterranean – while giving Israeli citizens a future income of hundreds of billions of shekels in the process.
“This money will benefit education, health, social welfare and other national needs,” Prime Minister Binyamin Netanyahu said at the start of the weekly cabinet meeting.
“I would like to commend the work done by Minister Steinitz’s team which has led to a very significant reduction in the price the state will pay for gas and to other changes that will greatly improve the outline.
“I am not impressed by populism – to me it is only populism, even though people could possibly believe in what they are saying, but the country needs gas. Gas resources in our region will be developed, unfortunately, either way, and we need to see to it that our resources work at full capacity.
“We need to extract the gas from the sea,” Netanyahu went on.
“This decision is an important milestone. We are overcoming the obstacles step by step. This process will not be stopped,” he said, making an oblique reference to the myriad attempts by various groups to stymie the agreement that was finally approved.
“The gas will be extracted from the bottom of the sea and will reach Israeli citizens, Israeli industry and the Israeli economy – for the benefit of the citizens of Israel.
“Every objective test proves this outline is a significant improvement over the existing situation. But one more thing must be understood – it cannot be stopped.
“When the right thing needs to be done, and it is so crucial to Israel’s economy and strategic situation, that thing will not be stopped. They will look for another way to delay, another excuse, another reason – and that will not work.
This outline will pass one way or another, and it is about time that it does. The true interests of the State of Israel require the passage of this outline as quickly as possible.”
Negotiations between the government and the consortium comprised of Texas-based Noble Energy and the Israeli company Dekel Group Ltd. have been dragging on for months.
Israel’s Antitrust Authority last year decided the consortium could not continue operations as the sole owners and operators of the massive Leviathan gas field, and the somewhat smaller but also large Tamar gas field – both of which were discovered and have been developed at considerable expense by the group.
Gas has already been produced from the Tamar field since 2013. Leviathan is considered the largest discovery in the world in the past decade – and certainly the largest field in the Mediterranean.
Negotiations over how pricing will be set for gas in the domestic market and the prices and percentage of reserves to be exported had taken place for months between the government and the group – which has pointed out that without being able to recoup its investment and also to be able to make a profit, there is little point to continuing its operations in the area.
Antitrust Commissioner David Gilo threatened to resign in May over his opposition to what he insisted was the group’s monopoly over the Tamar and Leviathan fields.
The gas deal negotiated with the government this past week allows Delek Group – owned by Yitzchak Tshuva – to sell its holdings in the Tamar field, and also two smaller fields, Karish and Tanin, within six years. Noble Energy will gradually reduce its own holdings in Tamar to a maximum of 25 percent within six years as well. Prices for natural gas will be regulated by the government within that same six-year period as well.