MKs, gas stakeholders spar at Knesset over exports

Economic Affairs Committee chairman and colleagues demand subject of gas export be transferred from the cabinet’s hands to those of the Knesset.

May 14, 2013 02:46
Shaul Zemach

Shaul Zemach 370. (photo credit: Courtesy Ministry of Energy)

Tensions stirred in the Knesset Economic Affairs Committee on Monday, as politicians from across the spectrum and gas industry stakeholders sparred over the increasingly hot-button issue of exporting the country’s natural gas.

The offshore Tamar reservoir is already flowing into the country’s transmission pipelines, with the 282 billion cubic meters found there dedicated to domestic use only. Tamar’s roughly double-sized neighbor, Leviathan, which should be developed within the next few years, is expected to supply both export and domestic needs.

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While the Zemach Committee – headed by Energy and Water Ministry director-general Shaul Zemach – recommended in the early fall that a maximum of 50 percent, or 500 billion cubic meters, be allowed for export, environmentalists have slammed these figures as too generous.

At Monday’s meeting, Economic Affairs Committee chairman Avishay Braverman (Labor) and many of his colleagues demanded that the subject of gas export be transferred from the cabinet’s hands to those of the Knesset. As the issue impacts the public today and in future generations, a comprehensive discussion in the Knesset must occur, he said.

“The gas issue is a central issue for the future of the country,” Braverman said. “The decision to export gas must be made here in the Knesset and not by government regulation.

I urge the prime minister and the energy and water minister to bring the subject to an open and transparent discussion in the Knesset.”

Determining Israel’s gas needs “is a question of what is good for the citizens of Israel in 50, 60, 70 years from now,” he said.

Following Braverman’s introduction, Zemach took the floor to explain the exact recommendations of the committee. In addition to guaranteeing that a maximum of 50%, or 500 billion cubic meters, of the country’s gas reserves would be approved for export, the report also recommends that at least 450 billion cubic meters be secured at home – enough to supply the country for the next 25 years, according to the committee.

Preserving enough gas for 25 years will allow the government to create a practical balance between domestic reserve needs and the development that is spurred by export allowances, he explained.

“Until there is 450 billion cubic meters, there will be no export from the Israeli market,” Zemach said.

As other Knesset members and industry stakeholders continually interrupted Zemach’s presentation with shouts and comments across the room, several quibbled over a particular question of numbers.

They asked Zemach: Once the country puts aside 450 billion cubic meters for at-home use, if there was hypothetically an additional 450 billion cubic meters discovered, would that second quantity go entirely to export, or is it split evenly between domestic and foreign use? Zemach did not answer the question immediately, and shouts continued across the room as to whether the hypothetical domestic supply would then be 450 billion cubic meters or 675 billion cubic meters.

After a series of unclear responses, Braverman accused Zemach of failing to give the public a truthful answer.

“How can a person with your professional experience and education not answer a question for an hour?” he asked.

Emphasizing that the answer was based on a theoretical, hypothetical situation only, Zemach said that if there were 450 billion cubic meters and then another 450 billion cubic meters proven, the drilling companies would be allowed to export 450 billion cubic meters.

Reminding the discussion participants that only export can encourage future exploration, Zemach noted that “gas in the land does not contribute to energy security.”

“The export of gas will help generate competitiveness among companies and make them continue to explore for more natural gas reservoirs that will help the economy,” he said.

Opposition leader MK Shelly Yacimovich (Labor) was not satisfied with Zemach’s explanations and said that the discussion on exports should be opened only five years from now, after Israeli consumers know they will have what they need.

“There is a simple thing to do – just don’t make the decision now,” she said. “Why is the government in such a rush?” Accusing the Zemach Committee of hiding its protocols from the public, Yacimovich added that “the ambiguity of the committee protocols is not accidental.”

MK Dov Henin (Hadash), meanwhile, accused the Zemach Committee of being too optimistic about the quantities of gas found in the Leviathan reservoir and too pessimistic about the demand for the gas that will occur in the Israeli energy sector.

Stressing that there are still many Israeli factories that have not even properly considered their need for gas, Dror Sturm, president of the Israeli Institute for Economic Planning, warned that the committee has not correctly calculated future demand.

MK Tamar Zandberg (Meretz) echoed these same concerns.

“It’s not logical to just leave enough gas for the energy sector for 25 years,” added Dana Tabachnik, head of the economics and environment department at Adam Teva V’Din (Israel Union for Environmental Defense).

On the other side of the page, representatives from drilling companies stressed just how critical an export policy will be to bringing in future explorers and for creating competition in Israel’s Mediterranean waters.

“The local demand for gas will not supply the critical mass for additional drillings,” said Yarom Ariav, representing the US-based Edison Electric Institute, but who served as Finance Ministry directorgeneral from 2008 to 2009.

Meanwhile, Amir Hayak, CEO of the Manufacturers Association – which includes many of the major industrialists who will rely on natural gas – said that his organization is satisfied with the conclusions of the Zemach Committee.

No matter what the end decision on the matter is, MK Eitan Cabel (Labor) noted that “it doesn’t matter who is right and wrong,” and that there is a certain need for future discussion.

“It’s not a question of Right and Left, it’s a test of this whole inclusive house,” he said.

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