Netanyahu defends gas outline as critical to energy security

Economic Affairs Committee head calls on PM to rescind 'twisted and evil' plan.

December 8, 2015 12:32
Netanyahu and Steinitz

Prime Minister Benjamin Netanyahu and Energy Minister Yuval Steinitz at Economic Affairs Committee at the Knesset, December 8, 2015.. (photo credit: KNESSET SPOKESMAN'S OFFICE)

As Economic Affairs Committee members bashed the country’s long-disputed natural gas outline as detrimental to the public during a heated three-hour session on the subject Tuesday, Prime Minister Benjamin Netanyahu defended the document’s vital role in achieving energy security.

“You and your colleagues reject the security and foreign policy interest in our considerations,” Netanyahu told the committee’s chairman, MK Eitan Cabel (Zionist Union).

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“The opposite is true; we are going to ensure the energy security of Israel.

“Energy security is critical not just the function of the state, but to ensuring its existence,” the prime minister added.

Assuming his alternate role of economy minister that morning, he addressed the committee in the 10th in a series of discussions that are a prerequisite to implementing the gas outline. Although the deal in question received required cabinet approval in August, fully activating the outline demands that the economy minister invoke a legal clause to sidestep the Antitrust Authority’s objections – Article 52 of the 1988 Restrictive Trade Practices Law (The Antitrust Law).

While the article has never before been implemented in Israel’s history, an economy minister can do so by citing national security or foreign policy interests. After former economy minister Arye Deri resigned from his position in the ministry last month, it became Netanyahu’s duty in that role to consult with the Economic Affairs Committee prior to activating Article 52.

For his part, Cabel opened his committee’s session Tuesday morning by describing the Antitrust Law as “the Magna Carta of consumers and the free market,” stressing that for years the committee has been working to provide parliamentary oversight on the issue and protect the public from monopolies and cartels.

“Once, Mr. Prime Minister, you carried a pillar of fire of competition and its advancement,” Cabel said.

“And, today, a different spirit is blowing – different because according to all the experts that appeared before us, the current outline perpetuates a monopoly that, according to the stance of the most professional authority in Israel, is infected at its foundation by restrictive arrangements.”

Presenting some of his objections to the gas outline, Cabel said the document does not ensure a clear-cut commitment to the development of the Leviathan reservoir, due to the lack of sanctions and enforcement mechanisms. In addition, he pointed out how the outline does not guarantee the construction of an additional gas pipeline to the country’s shores, and cited Bank of Israel data showing that public revenue would be much lower than anticipated.

Regarding foreign policy concerns, he acknowledged the importance of “tightening political and security relations with Egypt” and of supplying gas to Jordan and the Palestinian Authority. He stressed that he was not convinced, however, that “if the outline is not implemented, Israel’s security would be undermined or if foreign policy with Egypt would fall apart.”

“At the end of the discussions, I can say here without reservation that we must do everything required to stop this twisted and evil outline for the citizens of Israel,” he said. “I ask you, Mr. Prime Minister, for God’s sake, do not use the name of security in vain.

You do not have any real justification to use Article 52.”

Responding to Cabel’s comments, Netanyahu reiterated the importance of activating the gas outline for the sake of energy security. He began by discussing how, in November 2013, the cabinet decided to invest NIS 3 billion to secure the country’s economic waters, where the gas infrastructure is located. Although this investmentprovides some defense, additional protection can be gained through redundancy, the prime minister explained.

“To me, this outline is the only way to create redundancy in the number of fields, rather than shrinking to one threatened field,” he said.

Netanyahu emphasized the importance of pursuing an export program, and the strength that such a capability can provide to a country.

Supplying gas to Israel’s neighbors would be in the best interest of both Israel and these countries, he said, adding a “layer of stability” that is in everyone’s interest.

Addressing Netanyahu, opposition leader Isaac Herzog (Zionist Union) accused the prime minister of conducting deals that have been “amateurish at best and lawless at worst.”

“You bypass the regulators for reasons of state security and foreign relations, and it is unclear how this is related to the price of 1 BTU [British thermal unit] for the consumer, which has been set in the government negotiations, or agreements of the Israel Electric Corporation that, today, are known to be outrageous,” Herzog said. “Therefore, the question arises whether the name of security is being taken in vain.”

National Infrastructure, Energy and Water Minister Yuval Steinitz followed up on Herzog’s comments, expressing his belief that “there is no other realistic outline aside from this outline,” and that Israeli citizens will surely receive much more than the global average in revenues from gas production.

Reacting to questions posed by MK Dov Henin (Joint List), who spoke of the lack of commitments to building an additional gas pipeline and to expediting the development of Leviathan, Netanyahu expressed his confidence that the milestones set for Leviathan would ensure its operation.

Meanwhile, although the construction of another gas pipeline is important, the development of additional gas fields themselves is more critical, he argued.

After Netanyahu said that “it is preferable to be an export country than an import country,” MK Shelly Yacimovich (Zionist Union) pointed out that gas is a resource that is non-renewable and constantly depleting.

Yacimovich then asked the prime minister how Egypt’s new gas finds and the Egyptian government’s recent announcement that it would freeze gas import talks with Israel over an arbitration issue could influence the need to export.

Despite claims that the gas will remain stuck in the ground if not developed, gas has been flowing from the Tamar reservoir for two years and could provide ample supplies to Israel, the Palestinian Authority and Jordan for the next 15 years, she added.

In response, Netanyahu said that by encouraging new companies to come and invest in developing the gas sector, the range of gas available could potentially be extended for decades longer.

“No one is coming to Israel,” he added. “Israel is becoming a country of over-regulation, of politicization, a situation of anti-infrastructural and anti-business development.”

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