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<div class="articleTitle">War and Natural Gas: The Israeli
Invasion and Gaza's Offshore Gas Fields</div>
<br>
<div class="articleAuthorName">by Michel Chossudovsky</div>
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<div class="bigArticleText12"><a
href="http://www.globalresearch.ca">Global Research</a>, January 8,
2009</div>
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<p align="justify"><font face="Verdana">The
military invasion of the Gaza Strip by Israeli Forces bears a direct
relation to the control and ownership of strategic offshore gas
reserves. </font></p>
<p align="justify"><font face="Verdana">This is a war of
conquest. Discovered in 2000, there are extensive gas reserves off the
Gaza coastline. </font></p>
<p align="justify"><font face="Verdana"><a
href="http://www.bg-group.com/OurBusiness/WhereWeOperate/Pages/pgIsraelandAreasofPalestinianAuthority.aspx"
target="_new">British Gas (BG Group)</a> and its partner, the Athens
based </font><a href="http://www.ccc.gr/"><font face="Verdana">Consolidated
Contractors International Company</font></a><font face="Verdana">
(CCC) owned by Lebanon's Sabbagh and Koury families, were granted oil
and gas exploration rights in a 25 year agreement signed in November
1999 with the Palestinian Authority. </font></p>
<p align="justify"><font face="Verdana">The rights to the
offshore gas
field are respectively British Gas (60 percent); Consolidated
Contractors (CCC) (30 percent); and the Investment Fund of the
Palestinian Authority (10 percent). (Haaretz, October 21, 2007). <br>
<br>
The
PA-BG-CCC agreement includes field development and the construction of
a gas pipeline.(Middle East Economic Digest, Jan 5, 2001). </font></p>
<p align="justify"><font face="Verdana">The BG licence covers the
entire Gazan offshore marine area, which is contiguous to several
Israeli offshore gas facilities. (See Map below). It should be noted
that 60 percent of the gas reserves along the Gaza-Israel coastline
belong to Palestine. </font></p>
<p align="justify"><font face="Verdana">The BG Group drilled two
wells in 2000: <b>Gaza Marine-1 and Gaza Marine-2. </b>Reserves
are estimated by British Gas to be of the order of 1.4 trillion cubic
feet, valued at approximately 4 billion dollars. These are the figures
made public by British Gas. The size of Palestine's gas reserves could
be much larger. </font></p>
<p align="justify"><font face="Verdana"><img
src="cid:part5.04000505.06000404@aim.com" border="0"><br>
Map 1</font></p>
<p align="justify"><font face="Verdana"><img
src="cid:part6.01090204.05060805@aim.com" border="0"></font></p>
<p align="justify"><font face="Verdana" size="1">Map 2</font></p>
<p align="justify"><font face="Verdana"><b>Who Owns the Gas Fields</b></font></p>
<p align="justify"><font face="Verdana">The issue of sovereignty
over Gaza's gas fields is crucial. From a legal standpoint, the gas
reserves belong to Palestine. </font></p>
<p align="justify"><font face="Verdana">The death of Yasser
Arafat, the
election of the Hamas government and the ruin of the Palestinian
Authority have enabled Israel to establish <i>de facto</i> control
over Gaza's offshore gas reserves. </font></p>
<p align="justify"><font face="Verdana">British Gas (BG Group)
has been
dealing with the Tel Aviv government. In turn, the Hamas government has
been bypassed in regards to exploration and development rights over the
gas fields. </font></p>
<p align="justify"><font face="Verdana">The election of Prime
Minister
Ariel Sharon in 2001 was a major turning point. Palestine's sovereignty
over the offshore gas fields was challenged in the Israeli Supreme
Court. Sharon stated unequivocally that "Israel would never buy gas
from Palestine" intimating that Gaza's offshore gas reserves belong to
Israel. </font></p>
<p align="justify"><font face="Verdana">In 2003, Ariel Sharon,
vetoed
an initial deal, which would allow British Gas to supply Israel with
natural gas from Gaza's offshore wells. (The Independent, August 19,
2003) </font></p>
<p align="justify"><font face="Verdana">The election victory of
Hamas
in 2006 was conducive to the demise of the Palestinian Authority, which
became confined to the West Bank, under the proxy regime of Mahmoud
Abbas. </font></p>
<p align="justify"><font face="Verdana">In 2006, British Gas "was
close
to signing a deal to pump the gas to Egypt." (Times, May, 23, 2007).
According to reports, British Prime Minister Tony Blair intervened on
behalf of Israel with a view to shunting the agreement with Egypt. </font></p>
<p align="justify"><font face="Verdana">The following year, in
May
2007, the Israeli Cabinet approved a proposal by Prime Minister Ehud
Olmert "to buy gas from the Palestinian Authority." The proposed
contract was for $4 billion, with profits of the order of $2 billion of
which one billion was to go the Palestinians. </font></p>
<p align="justify"><font face="Verdana">Tel Aviv, however, had no
intention on sharing the revenues with Palestine. An Israeli team of
negotiators was set up by the Israeli Cabinet to thrash out a deal with
the BG Group, bypassing both the Hamas government and the Palestinian
Authority: </font></p>
<blockquote>
<p align="justify"><font face="Verdana">"<b>Israeli defence
authorities
want the Palestinians to be paid in goods and services and insist that
no money go to the Hamas-controlled Government</b>." (Ibid, emphasis
added)</font></p>
</blockquote>
<p align="justify"><font face="Verdana">The objective was
essentially
to nullify the contract signed in 1999 between the BG Group and the
Palestinian Authority under Yasser Arafat. </font></p>
<p align="justify"><font face="Verdana">Under the proposed 2007
agreement with BG, Palestinian gas from Gaza's offshore wells was to be
channeled by an undersea pipeline to the Israeli seaport of Ashkelon,
thereby transferring control over the sale of the natural gas to
Israel. </font></p>
<!-- End of pagination -->
<p align="justify"><font face="Verdana">The deal fell through.
The negotiations were suspended:</font></p>
<blockquote>
<p align="justify"><font face="Verdana"> "Mossad Chief Meir
Dagan opposed the transaction on security grounds, that the proceeds
would fund terror". </font><font face="Verdana"><font size="1">(Member
of Knesset Gilad Erdan, Address to the Knesset on "The Intention of
Deputy Prime Minister Ehud Olmert to Purchase Gas from the Palestinians
When Payment Will Serve Hamas," March 1, 2006, quoted in Lt. Gen.
(ret.) Moshe Yaalon, </font></font><a
href="http://www.jcpa.org/JCPA/Templates/ShowPage.asp?DBID=1&LNGID=1&TMID=111&FID=283&PID=1845&IID=1896"><font
face="Verdana" size="1">Does the Prospective Purchase of British Gas
from Gaza's Coastal Waters Threaten Israel's National Security? </font></a><font
face="Verdana" size="1"> Jerusalem Center for Public Affairs, October
2007)</font></p>
</blockquote>
<p align="justify"><font face="Verdana">Israel's intent was to
foreclose the possibility that royalties be paid to the Palestinians.
In December 2007, The BG Group withdrew from the negotiations with
Israel and in January 2008 they closed their office in Israel.(</font><a
href="http://www.bg-group.com/OurBusiness/WhereWeOperate/Pages/pgIsraelandAreasofPalestinianAuthority.aspx"><font
face="Verdana">BG website</font></a><font face="Verdana">). </font></p>
<p align="justify"><b><font face="Verdana">Invasion Plan on The
Drawing Board</font></b></p>
<p align="justify"><font face="Verdana">The invasion plan of the
Gaza
Strip under "Operation Cast Lead" was set in motion in June 2008,
according to Israeli military sources: </font></p>
<blockquote>
<p align="justify"><font face="Verdana">"Sources in the defense
establishment said Defense Minister Ehud Barak instructed the Israel
Defense Forces to prepare for the operation over six months ago [June
or before June] , even as Israel was beginning to negotiate a ceasefire
agreement with Hamas."(Barak Ravid, </font><a
href="http://www.globalresearch.ca/index.php?context=va&aid=11521"><font
face="Verdana">Operation "Cast Lead": Israeli Air Force strike
followed months of planning,</font></a><font face="Verdana"> Haaretz,
December 27, 2008)</font></p>
</blockquote>
<p align="justify"><font face="Verdana">That very same month, the
Israeli authorities contacted British Gas, with a view to resuming
crucial negotiations pertaining to the purchase of Gaza's natural gas: </font></p>
<blockquote>
<p align="justify"><font face="Verdana">"Both Ministry of
Finance
director general Yarom Ariav and Ministry of National Infrastructures
director general Hezi Kugler agreed to inform BG of Israel's wish to
renew the talks.</font></p>
<p align="justify"><font face="Verdana">The sources added that
BG has
not yet officially responded to Israel's request, but that company
executives would probably come to Israel in a few weeks to hold talks
with government officials." (Globes online- Israel's Business Arena,
June 23, 2008)</font></p>
</blockquote>
<p align="justify"><font face="Verdana">The decision to speed up
negotiations with British Gas (BG Group) coincided, chronologically,
with the planning of the invasion of Gaza initiated in June. It would
appear that Israel was anxious to reach an agreement with the BG Group
prior to the invasion, which was already in an advanced planning
stage. </font></p>
<p align="justify"><font face="Verdana">Moreover, these
negotiations
with British Gas were conducted by the Ehud Olmert government with the
knowledge that a military invasion was on the drawing board. In all
likelihood, a new "post war" political-territorial arrangement for the
Gaza strip was also being contemplated by the Israeli government. </font></p>
<p align="justify"><font face="Verdana">In fact, negotiations
between
British Gas and Israeli officials were ongoing in October 2008, 2-3
months prior to the commencement of the bombings on December 27th. </font></p>
<p align="justify"><font face="Verdana">In November 2008, the
Israeli
Ministry of Finance and the Ministry of National Infrastructures
instructed Israel Electric Corporation (IEC) to enter into negotiations
with British Gas, on the purchase of natural gas from the BG's offshore
concession in Gaza. (Globes, November 13, 2008) </font></p>
<blockquote>
<p align="justify"><font face="Verdana">"Ministry of Finance
director
general Yarom Ariav and Ministry of National Infrastructures director
general Hezi Kugler wrote to IEC CEO Amos Lasker recently, informing
him of the government's decision to allow negotiations to go forward,
in line with the framework proposal it approved earlier this year.</font></p>
<p align="justify"><font face="Verdana">The IEC board, headed
by
chairman Moti Friedman, approved the principles of the framework
proposal a few weeks ago. The talks with BG Group will begin once the
board approves the exemption from a tender." (Globes Nov. 13, 2008) </font></p>
</blockquote>
<p align="justify"><b><font face="Verdana">Gaza and Energy
Geopolitics </font></b></p>
<p align="justify"><font face="Verdana">The military occupation
of Gaza
is intent upon transferring the sovereignty of the gas fields to Israel
in violation of international law. </font></p>
<p align="justify"><font face="Verdana">What can we expect in the
wake of the invasion? <br>
<br>
What is the intent of Israel with regard to Palestine's Natural Gas
reserves? </font></p>
<p align="justify"><font face="Verdana">A new territorial
arrangement, with the stationing of Israeli and/or "peacekeeping"
troops? </font></p>
<p align="justify"><font face="Verdana">The militarization of the
entire Gaza coastline, which is strategic for Israel? </font></p>
<p align="justify"><font face="Verdana">The outright confiscation
of
Palestinian gas fields and the unilateral declaration of Israeli
sovereignty over Gaza's maritime areas? </font></p>
<p align="justify"><font face="Verdana">If this were to occur,
the Gaza
gas fields would be integrated into Israel's offshore installations,
which are contiguous to those of the Gaza Strip. (See Map 1 above). </font></p>
<p align="justify"><font face="Verdana">These various offshore
installations are also linked up to Israel's energy transport corridor,
extending from the port of Eilat, which is an oil pipeline terminal, on
the Red Sea to the seaport - pipeline terminal at Ashkelon, and
northwards to Haifa, and eventually linking up through a <i>proposed </i>Israeli-Turkish
pipeline with the Turkish port of Ceyhan. </font></p>
<p align="justify"><font face="Verdana">Ceyhan is the terminal of
the
Baku, Tblisi Ceyhan Trans Caspian pipeline. "What is envisaged is to
link the BTC pipeline to the Trans-Israel Eilat-Ashkelon pipeline, also
known as Israel's Tipline." (See Michel Chossudovsky, </font><a
href="http://www.globalresearch.ca/index.php?context=va&aid=2824"><font
face="Verdana">The War on Lebanon and the Battle for Oil, </font></a><font
face="Verdana">Global Research, July 23, 2006)</font></p>
<p align="justify"><font face="Verdana"><br>
<img src="cid:part7.00080602.05010501@aim.com" border="0"><br>
<font size="1">Map 3</font></font><font face="Verdana"> <br>
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