Zionist Union petitions High Court over gas deal
search

Zionist Union petitions High Court over gas deal

Due to be heard next month, appeal says controversial agreement creates de-facto monopoly over strategic energy supply

Sue Surkes is The Times of Israel's environment reporter.

File: Israelis protest against a controversial agreement reached over the past few months between the government and large energy companies over natural gas production, in central Tel Aviv, on November 28, 2015. (Tomer Neuberg/Flash90)
File: Israelis protest against a controversial agreement reached over the past few months between the government and large energy companies over natural gas production, in central Tel Aviv, on November 28, 2015. (Tomer Neuberg/Flash90)

Three members of the opposition Zionist Union petitioned the High Court of Justice Monday against a deal signed in December by the state that would allow a two-company consortium to begin extracting gas from the massive Leviathan gas field off Israel’s coast.

Passage of the deal has been marked by a year of high political drama, including the resignation of former antitrust commissioner David Gilo and of former economy minister Aryeh Deri (the latter is now poised to become interior minister) and the biggest street protests since the social justice demonstrations of 2011. One of the three petitioners, economist Manuel Trajtenberg, headed a government committee set up in the wake of the social justice protests. He later said the government had ignored his committee’s recommendations.

This is the fourth petition against the deal. It urges the court to throw out the controversial framework, saying its legality is tenuous as it establishes a de facto duopoly over the nation’s strategic gas supply, and was passed via problematic constitutional procedures, including the resignation of Deri, which enabled Prime Minister Benjamin Netanyahu to become acting economy minister and override antitrust rules in order to ensure the deal’s passage.

The petition lists a catalog of legal flaws in the management of the deal, as well as “extreme lack of reason” and “disproportionately.” The government neglected basic issues in the natural gas market, the petition alleges, such as the problems of monopolistic pricing and lack of energy security, and is now “trying to sell an illusion in the guise of a deal” that will not only not solve the problems but will perpetuate them.

It will be deliberated by the court, along with other petitions on the matter, next month.

Negotiations have been underway with a consortium including Noble Energy and locally based Delek Group, with talks involving natural gas pricing for Israeli reserves and future production.

Noble and Delek have been producing gas from the Tamar field off the Israeli coast since 2013. They have also teamed up to develop the offshore Leviathan field, believed to be the largest in the Mediterranean, by 2019.

While Netanyahu has claimed the deal will bring hundreds of billions of shekels into state coffers, critics say they fear regulations favor the companies over the consumers.

read more:
comments