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After massive Egypt find, coalition to push gas deal through Knesset

Energy minister says vote on controversial agreement could come Wednesday, after ‘super-giant’ gas discovery off Egypt’s coast is announced

Workers on the Israeli Tamar gas processing rig, 24 kilometers off the southern coast of Ashkelon, October 11, 2013 (photo crdit: Moshe Shai/Flash90)
Workers on the Israeli Tamar gas processing rig, 24 kilometers off the southern coast of Ashkelon, October 11, 2013 (photo crdit: Moshe Shai/Flash90)

Energy Minister Yuval Steinitz and Prime Minister Benjamin Netanyahu on Monday will decide when to bring the controversial gas deal to a Knesset vote, with the minister indicating it could happen as soon as Wednesday.

With eyes on a massive offshore gas find announced Sunday off the coast of Egypt, the prime minister and energy minister were seeking to quickly advance the agreement, which has held up drilling in Israel’s offshore fields.

Steinitz told Army Radio on Sunday night that the deal could be brought to a vote on Wednesday, when the Knesset convenes for a special summer session to bring the two-year budget for a first reading. The date of the vote was set to be announced Monday, according to the radio report.

The cabinet is scheduled to meet Monday morning, with the gas deal outline likely on the agenda.

The American Noble Energy and the locally based Delek Group have faced opposition to their proposed deal with the government to develop a number of natural gas reserves discovered off Israel’s coast in recent years, including the Leviathan field, thought to be the Mediterranean’s largest before Sunday’s announcement.

Critics fear the deal’s regulations would overly favor the companies involved.

The high-stakes deal was thrown into the spotlight when outgoing antitrust commissioner David Gilo said last year that the Noble-Delek partnership resembled a monopoly, and called for opening Israel’s natural gas market to increased competition.

Netanyahu, however, has maintained that the deal would pump hundreds of billions of shekels into state coffers. He pushed the disputed deal between the government and the US-Israeli energy consortium through the cabinet earlier this month.

Steinitz on Sunday said the large natural gas field found offshore from Egypt — 40 percent larger than Israel’s Leviathan field — should be a wake-up call for Israel to finalize an agreement on its own sizable reserves in the Mediterranean Sea.

Prime Minister Benjamin Netanyahu (R) and Energy Minister Yuval Steinitz attend the weekly cabinet meeting in Jerusalem on August 16, 2015. (Marc Israel Sellem/POOL)
Prime Minister Benjamin Netanyahu (R) and Energy Minister Yuval Steinitz attend the weekly cabinet meeting in Jerusalem on August 16, 2015. (Marc Israel Sellem/POOL)

“The discovery of the massive gas field in Egypt is a painful reminder that while Israel sleepwalks and dallies with the final approval for the gas road map, and delays further prospecting, the world is changing in front of us, including ramifications for [Israeli] export options,” Steinitz said, referring to the ongoing regulatory dispute that has stalled the finalizing of the deal.

“We must pass the gas road map and forward the Israeli gas industry,” he said of a cabinet-backed deal to develop Israel’s Tamar and Leviathan reserves, Army Radio reported.

Italian energy group Eni announced earlier Sunday that it had discovered a “super-giant” natural gas field off Egypt, describing it as the “largest ever” found in the Mediterranean Sea.

Eni said the discovery — made in its Zohr prospect “in the deep waters of Egypt” — could hold a potential 30 trillion cubic feet of gas over an area of 100 square kilometers (38.6 square miles).

Israel’s Leviathan gas field is estimated to contain as much as 16 trillion cubic feet of gas.

The Noble-Delek group has been producing gas from the Tamar field off the Israeli coast since 2013, and has also teamed up to develop Leviathan by 2019.

Tamar’s stakeholders signed a contract earlier this year with a private Egyptian concern to sell as much as five billion cubic meters of gas to Egyptian companies over the next three years. This gas will be flowing through an old pipeline that once transported gas in the opposite direction, from Egypt to Israel.

In March, the Wall Street Journal reported that the Egypt government may import natural gas from Israel if its price were low enough and if one of the drilling companies dropped a legal action against the Egyptian government.

Jordan has also signed a $15-billion, 15-year letter of intent to import Israeli natural gas.

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