Doc's Talk: Political-Strategic Dimensions to Israel's Natural Gas Debate

Friday, May 24, 2013

Political-Strategic Dimensions to Israel's Natural Gas Debate

INSS Insight No. 429
Eran, Oded

In October 2011, the Israeli government appointed a committee headed by Water and Energy Ministry director general Shaul Tzemach to examine the government’s policy on natural gas. The government is supposed to adopt the committee’s recommendations, which were published in April 2012, immediately upon completion of the budget deliberations. On May 13, 2013, however, Knesset Finance Committee chairman Avishai Braverman stated that the Knesset would decide on the future of the recommendations – in particular, how much gas will be reserved for local use and how much will be available for export: since the Knesset was mandated to determine the royalties the state will collect on revenues from the sale of natural gas, so, MK Braverman contends, should it decide related aspects. The debate on the issue has heated up, and some who argue against export (of even a small percentage of the gas), because they believe it would harm the Israeli consumer, are currently demonstrating outside the homes of those directly involved in the issue.

How much gas to retain for domestic consumption and how much to export has political-economic and strategic ramifications. There is no argument about the fact that Israel is a special case in terms of energy security, and that it must maintain independence in the supply of a strategic resource such as natural gas – even though Israel has never enjoyed such independence, and conversely, even though Israel has never experienced any crisis in meeting its energy needs.

The Tzemach Committee looked at a period of twenty-five years. After examining a number of consumption scenarios, it recommended the one in which Israel’s cumulative consumption up to 2040 would reach 450 billion cubic meters. According to estimates by the US Geological Survey, the quantities of recoverable gas in the area in which Israel has exclusive economic rights come to 1.4 trillion cubic meters. However, the committee was conservative, and calculated the total amount that could be considered recoverable to be 950 billion cubic meters. Accordingly, the committee recommended a 50-50 ratio between domestic consumption and export.

In the public debate too little attention has been paid to the political-economic and strategic aspects. Some of these are difficult to calculate, and hence it is hard to assess their benefit. Another problem involves the different timetables. The Tzemach Committee gave clear priority to ensuring that the Israeli economy’s natural gas needs are fully preserved, and made export conditional on fulfilling these needs. This process will continue for several years, and it is dependent on both the discovery and the utilization of gas reservoirs. However, immediate export would have strategic and economic advantages, for example, realizing the Committee's conviction that export is necessary in order to obtain the essential financing for developing the gas fields and the associated infrastructures. The recommendation to allow export only after there is complete confidence that there will be accessible gas above 450 billion cubic meters could complicate obtaining outside financing for the periods of time associated with the investments.

Several other issues should be noted. Gas deposits in the Mediterranean are spread over the Exclusive Economic Zones of several countries: Egypt, Israel, Lebanon, Cyprus, and possibly Syria as well. It is nearly certain that there is natural gas in the maritime space of Gaza. The costs of building the infrastructures for exporting natural gas are enormous, and they invite regional cooperation. While it is difficult to expect direct cooperation in the current political circumstances in the region, it might be possible through third countries and companies. However, these would take the risks involved only if the amounts of available gas for export justified the risks.

Cooperation, even indirect, with other gas exporters in the region increases the regional players’ interest in stability. Even sub-state actors such as Hamas and Hizbollah would be interested in this stability to ensure the flow of revenues that Lebanon and Gaza would enjoy if they developed the gas in their Exclusive Economic Zones. Although difficult, third countries and companies could theoretically aid in mediating between states that do not have relations with each other, but they would require agreed-upon management and use of joint reservoirs that cross borders. Such utilization of resources generally requires agreements between the states that have rights to the reservoirs.

Israel’s immediate neighbors, particularly Jordan and the Palestinian Authority, need a supply of gas. Jordan’s situation has worsened for the same reason that Israel’s has been harmed, that is, the frequent sabotaging of gas pipelines in the Sinai. The difficulties in supplying energy have leveled significant pressure on the Jordanian economy, which faces enormous difficulties as a result of the need to handle half a million registered Syrian refugees and perhaps a similar number of unregistered refugees. The Jordanian Ministry of Energy expects consumption of 4.5 billion cubic meters in 2015, and amounts of this magnitude would not substantially alter the Tzamach committee’s considerations. Jordan can be connected to Israel’s gas transmission networks in two locations – south of the Sea of Galilee and in the industrial region at the Dead Sea, and this could be implemented quickly. It has been postponed in part due to a delay in adopting the Tzemach Committee’s recommendations and a lack of clarity concerning export of gas.

Connecting Israel to its neighbors through water, energy, communication, and transportation networks has greater strategic value than certain other elements of the normalization proposed to Israel in the Arab Peace Initiative. Such connections create a mutual balance of interests that opponents of normalization cannot ignore. Therefore, the government of Israel, with the approval of the Knesset, ought to act now to exclude the supply of natural gas to neighboring countries from the overall discussion of the domestic consumption to export ratio. Gas could be supplied to the Palestinians in the future, for example, in exchange for the gas that Israel would receive from the gas reservoir in the Gaza maritime space.

Israel has several potential markets for its natural gas beyond the small regional markets, including China, India, Turkey, and Europe, and the political component must be considered along with the economic dimension. Export of gas to each of these destinations could improve Israel’s international standing, even though the quantities are small compared to consumption of natural gas in these potential markets. Furthermore, exporting to the east or exporting to the west could create regional cooperation in the field of gas transportation.

As far as cooperation on natural gas is concerned, Turkey is an enigma at this point, both as a large consumer and in terms of transporting gas to Europe. In spite of pronouncements by Turkish leaders that they will not cooperate with Israel in this domain, an internal discussion in an inter-ministry body could be held in order to examine all aspects of bilateral energy cooperation.

While it is difficult to quantify these strategic benefits, it is clear that they will not be realized without the prospect of significant export. Although the argument here is not to overrule the committee’s basic assumptions, it would be appropriate to draft a long term plan to provide the Israeli consumer with energy security and a supply of natural gas and to allow exports to be utilized to improve Israel’s strategic balance. Global commerce in natural gas involves commitments for 15-25 years, and the longer Israel delays making decisions about exports and the quantities to be exported, the more likely it is to find markets that are saturated or consumers that seek to buy at lower prices. In the time periods the committee discussed, that is, twenty-five years or more, far reaching changes may take place in the field of energy, sources of energy, and utilization of energy. Changes such as these could also affect the ability to realize possible gains from export of natural gas in a ten-year period.

What is needed is a tool that allows ongoing updating and calibration of local and global market conditions; a determination of the necessary level of energy security for longer periods of time than twenty-five years; and calculation of political and economic situations so that gas export can be leveraged for strategic gains for Israel.

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The IDF’s Minorities in Numbers and Pictures

In honor of IDF Diversity Week, we present diversity through numbers and pictures. Each year, more and more Muslims, Christians, Druze, Bedouin and immigrants from around the world take on the responsibility of defending Israel.

MUSLIMS:

Muslim Arab Israelis are not required to draft in the IDF, but there are many who volunteer. In 2013, there were over 200 Muslims serving in the IDF and over 300 in the reserves.

Bedouins:

Bedouins are nomadic Muslims who were in Israel when modern borders were set in place and are now considered Israeli citizens. They are not required to draft but a growing number choose to enlist. In 2012, there were over 1,400 Bedouin Muslim soldiers doing regular IDF service and almost 1,500 in the reserves.

Read more:http://www.idfblog.com/2014/02/27/truth-idf-numbers-pictures/#more-34027

Are you aware that in 2013, Middle class taxes go up-significantly?

In January of next year, the federal income tax rate for middle-class taxpayers is scheduled to rise from 25 percent to 28 percent, and the payroll tax is scheduled to rise from 13.3 percent to 15.3 percent… This drives the marginal tax rate based on the aforementioned three taxes to 48.12 percent. Add in state and local property, corporate, excise, and other state and local taxes, and the percentage of each additional dollar that is taxed hovers around 50 percent… When half of each additional dollar earned is taxed away, taxpayers experience a disincentive to start businesses or expand existing ones. This leads to fewer jobs being created.

Why is HAMAS Inside Tampa Schools?

Clare Lopez

Kelly Miliziano, who teaches history classes at Steinbrenner High School in the Tampa, Florida area apparently thinks it’s perfectly OK to invite a senior official of a HAMAS-affiliated organization into her classroom to discuss Islam with her students. According to local media reports, not only has this been going on for years, but in spite of the civil and criminal proceedings that could result from such reckless negligence, the Hillsborough County school superintendent, Mary Ellen Elia, and the chairman of the school board, Candy Olson, also expressed approval for students under their responsibility to be exposed repeatedly to guest speaker, Hassan Shibly, who is the Executive Director for the Council on American-Islamic Relations (CAIR) in the Tampa area.
More...

Did You Know... Ignoring the Call to Islam will Bring Jihad

‘Conquest through Da’wa [proselytizing] that is what we hope for. We will conquer Europe, we will conquer America! Not through sword but through Da’wa.’
-- Yousef al-Qaradawi , Muslim Brotherhood spiritual leader The Arabic word ‘Da’wa’ means the “call to Islam.” But do not think that Da’wa is the same thing as an invitation to an optional holiday event. The classical Islamic doctrine of jihad mandates that enemies must be given the opportunity to convert to Islam or pay the jizya tax before it is permissible to attack them.
Clare M. Lopez

Who is being discriminated-facts tell the truth

Religious bias

Hate crimes motivated by religious bias accounted for 1,409 offenses reported by law enforcement. A breakdown of the bias motivation of religious-bias offenses showed:

65.4 percent were anti-Jewish.
13.2 percent were anti-Islamic.
9.5 percent were anti-other religion, i.e., those not specified.
4.3 percent were anti-Catholic.
3.8 percent were anti-multiple religions, group.
3.3 percent were anti-Protestant.
0.5 percent were anti-Atheism/Agnosticism/etc.

http://www.fbi.gov/about-us/cjis/ucr/hate-crime/2010/narratives/hate-crime-2010-incidents-and-offenses.

On March 31, 1977, the Dutch newspaper Trouw published an interview

with PLO executive committee member Zahir Muhsein. Here's what he said:

"The Palestinian people does not exist. The creation of a Palestinian state is only a means for continuing our struggle against the state of Israel for our Arab unity. In reality today there is no difference between Jordanians, Palestinians, Syrians and Lebanese. Only for political and tactical reasons do we speak today about the existence of a Palestinian people, since Arab national interests demand that we posit the existence of a distinct "Palestinian people" to oppose Zionism.

For tactical reasons, Jordan, which is a sovereign state with defined borders, cannot raise claims to Haifa and Jaffa, while as a Palestinian, I can undoubtedly demand Haifa, Jaffa, Beer-Sheva and Jerusalem. However, the moment we reclaim our right to all of Palestine, we will not wait even a minute to unite Palestine and Jordan."

In March 1977, Zahir Muhsein, a PLO executive, said:

"The Palestinian people does not exist. The creation of a Palestinian state is only a means for continuing our struggle against the state of Israel for our Arab unity. In reality today there is no difference between Jordanians, Palestinians, Syrians and Lebanese. Only for political and tactical reasons do we speak today about the existence of a Palestinian people, since Arab national interests demand that we posit the existence of a distinct Palestinian people to oppose Zionism."

"For tactical reasons, Jordan, which is a sovereign state with defined borders, cannot raise claims to Haifa and Jaffa, while as a Palestinian, I can undoubtedly demand Haifa, Jaffa, Beer-Sheva and Jerusalem. However, the moment we reclaim our right to all of Palestine, we will not wait even a minute to unite Palestine and Jordan."

The Arab Apartheid

Ben-Dror Yemini
In 1948, the Arab countries refused to accept the UN partition proposal and they launched a war of annihilation against the State of Israel which had barely been established. All precedents in this matter showed that the party that starts the war - and with a declaration of annihilation, yet - pays a price for it. Between 550,000 and 710,000 Arabs fled because of the war and a larger number of 850,000 Jews were expelled or fled from Arab countries (the "Jewish nakba").
Population exchanges and expulsions were the norm at that time, occurring in dozens of other conflict points and affecting about 52 million people. In all the population exchange precedents that occurred during or at the end of an armed conflict, there was no return of refugees to the previous region, which had turned into a new national state.
Only the Arab states acted completely differently from the rest of the world. Instead of assimilating the refugees, they crushed them despite the fact that they were their coreligionists and members of the Arab nation - instituting a regime of apartheid. So the "nakba" was not caused by the actual dispossession, which had also been experienced by tens of millions of others. The "nakba" is the story of the apartheid, oppression, abuse and denial of rights suffered by the Arab refugees at the hands of the Arab countries. (Maariv)

International Law and Military Operations in Practice - Col. Richard Kemp

"Islamist fighting groups study the international laws of armed conflict carefully and they understand it well. They know that a British or Israeli commander and his men are bound by international law and the rules of engagement that flow from it. They then do their utmost to exploit what they view as one of their enemy's main weaknesses. Their very modus operandi is built on the correct assumption that Western armies will normally abide by the rules, while these insurgents employ a deliberate policy of operating consistently outside international law. "

Lost Historical Moments

What Rabin’s last Knesset speech really said:repudiation of a Palestinian state

Rabin ruled out a fully sovereign Palestinian state :

“We view the permanent solution in the framework of State of Israel which will include most of the area of the Land of Israel as it was under the rule of the British Mandate, and alongside it a Palestinian entity which will be a home to most of the Palestinian residents living in the Gaza Strip and the West Bank. We would like this to be an entity which is less than a state, and which will independently run the lives of the Palestinians under its authority.”

Rabin ruled out a total withdrawal from Judea and Samaria and thus a return to the pre-June 1967 borders :

“The borders of the State of Israel, during the permanent solution, will be beyond the lines which existed before the Six Day War. We will not return to the 4 June 1967 lines.”

Rabin ruled out withdrawing form the Jordan Valley:

“The security border of the State of Israel will be located in the Jordan Valley, in the broadest meaning of that term.”

Rabin ruled out uprooting settlement blocs, like the Gush Katif bloc in Gaza (which was subsequently uprooted by former Prime Minister Ariel Sharon):

“The establishment of blocs of settlements in Judea and Samaria, like the one in Gush Katif.

AND

Rabin ruled out removing any settlement before coming to a full peace agreement with the Palestinians:

“I want to remind you: we committed ourselves, that is, we came to an agreement, and committed ourselves before the Knesset, not to uproot a single settlement in the framework of the interim agreement, and not to hinder building for natural growth.”

Rabin insisted on Israel retaining full security control of the borders with Egypt and Jordan, contrary to Israel’s relinquishment of the Philadelphia Corridor on the border with Egypt:

“The responsibility for external security along the borders with Egypt and Jordan, as well as control over the airspace above all of the territories and Gaza Strip maritime zone, remains in our hands.”

Correcting Oslo Myths-Part 2

3) Kuttab laments that the post-1993 Oslo process resulted in a Palestinian Authority "whose ministers and legislators are not guaranteed passage between Gaza and the West Bank ...."

Before free passage or other perquisites, PA leaders were obligated, among other things, to eliminate the terrorist infrastructure in the West Bank and Gaza Strip, end anti-Israeli, antisemitic incitement in schools, mosques, and communications media, and resolve all outstanding issues through peaceful negotiations. They met none of these commitments, sometimes bolstering terrorism and greatly increasing incitement.

4) Kuttab complains that under Oslo the PA got "lightly armed police ---- but no real sovereignty over the land or contiguity between our communities in Gaza and the West Bank."

Oslo agreements repeatedly were revised, regardless of Palestinian non-compliance, until the authorized number of police grew from 8,000 to 40,000. Though they were to be the only armed forces in the territories, Israeli estimates early in the second intifada put the number of gunmen - police, "security services," terrorists, and armed gangs - at 85,000. Their armament reportedly included not only heavy machine guns and rocket-propelled grenades, but also anti-tank and anti-aircraft missiles.

Sovereignty was to be negotiated in the envisioned 1998 "final status" talks - after a five-year period of confidence-building. Palestinian leadership chronically undermined the process. Palestinian terrorism made the 1993 - 1998 Oslo period more deadly for Israelis than the 15 years preceding it.

The United States doesn't have contiguity between the lower 48 states and Alaska and Hawaii; territorial contiguity between the West Bank and Gaza Strip - that is, through the 20 miles of Israeli territory between them - was never promised and would destroy Israeli contiguity.

5) "Palestinians have been made to endure hundreds of checkpoints in the West Bank, an eight-foot wall deep in our territories, and tight Israeli control over borders."

The security barrier is not "deep in Palestinian territories," but rather encompasses less than 8 percent of Judea and Samaria, and is mostly a fence, rarely a wall; the land in question is not "our [Palestinian] territories" but disputed territory to which, according to the authors of U.N. Security Council Resolution 242, Jews as well as Arabs have claims; and there are no international borders, only the 1949 armistice lines with Jordan. Under 242, borders remain to be negotiated. As for checkpoints - like the security barrier and "tight Israeli control" - Palestinian Arabs precipitated these measures themselves. No terrorism and there would be no fence or tight Israeli control and few checkpoints - like before the first intifada.

Correcting Some Oslo Myths

1) In Oslo "Israeli, Palestinian and other world leaders promised that ... Palestinian sovereignty would be solidified."

No, they didn't. The 1993 Declaration of Principles and subsequent Oslo agreements outlined a process by which final status negotiations about the West Bank and Gaza Strip would be reached. The process required an end to anti-Israel terrorism and incitement and a commitment to peaceful negotiations. The PA, Fatah, Hamas, Islamic Jihad, the Popular Front for the Liberation of Palestine, and other terrorist groups, sabotaged the process from the start.

2) "The reality is that, in defiance of U.N. Security Council Resolution 242, which states that it is inadmissible to occupy land by force, Palestinian territories are still under foreign military occupation."
Wrong again. Resolution 242 (1967) does note "the inadmissibility of the acquisition of territory by war." It also affirms the right of every state in the area "to live in peace with secure and recognized boundaries free from threats or acts of force." There were no "Palestinian territories." Jordan occupied the West Bank, Egypt controlled Gaza. Israel did not have "secure and recognized boundaries," so retention of some of those territories was possible under 242. Israel is not a "foreign" military occupier in the West Bank but, pending final negotiations, the lawful military administrator as a result of a successful war of self-defense.

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