Palestinian officials secured a deal with British Gas in the late 1990s allowing the exploration and drilling for natural gas and oil reserves in the Mediterranean Sea. In September of 2000, President Yasser Arafat himself watched anxiously as their hopes were rewarded with a huge flame shooting into the sky from a British Gas well 22 miles off the coast of the Gaza Strip. Arafat called the impressive showing of anticipated wealth a “gift to God to us, to our people, to our children,” stating further that the reserves would “provide a solid foundation for our economy, for establishing an independent state with holy Jerusalem as its capital.” In the eight years since this discovery, political jockeying and grappling has much stymied the exportation efforts of Palestine, hindering their ability to truly maximize their reserves and boost economic growth.
In July 2005, Palestinian’s chief export hope, Israel, signed a deal to import natural gas not from its gas-rich neighbor, Palestine, but instead circumventing them to import their natural gas fuel needs from Egypt. Purely a move motivated by politics, Prime Minister Ariel Sharon opposed any financial agreement made with the Palestinian Authority fearing that any monies exchanged would be used to support terrorist operations against Israel. This Israeli deal squashed initial Palestinian hopes that the gas trade would motivate the formation of new jobs in Gaza and earn $40 million to $45 million in taxes annually to help assist in bolstering their government towards eventual statehood.
The Gaza Marine field promises a yield of approximately 1.2 trillion cubic feet of natural gas in its ample reserve. This large reserve of gas has the ability to provide much more than Palestine’s energy needs, which are minimal. British Gas entered into the last stages of talks, nearly reaching an agreement with Egypt as recently as 2006 to export a minimum of 1.5 billion cubic yards of natural gas annually for 50 years through a proposed Gaza-E Arish pipeline. This proposed deal was thrown a major road block by then British Prime Minister Tony Blair who decided that British Gas should give Israel one more chance at making the gas deal with Palestine, insisting that the gas could provide a large part of the energy needs of Israel’s rapidly growing economy. Though Israeli leaders recognized this growing need for gas, their opposition to trade with Palestine once again hobbled the hopeful bridging of gaps between the two. This has resulted in British Gas and Palestine resuming talks with Egypt, hoping to finalize a deal in early 2008, putting an end to the confusion which began with hope and anticipation of wealth nearly a decade earlier.
About the Author: Robert Jent is the president of Triple Diamond Energy Corp. Triple Diamond Energy specializes in acquiring the highest quality prime oil and gas properties. For more information, visit http://www.triplediamondenergycorp.blogspot.com.
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