The energy market in Israel is on the alert following a massive merger which took place yesterday between the giant Amoco of the US and UK giant British Petroleum. Amoco is one of the only leading fuel companies worldwide which has been active in Israel in recent years, and has not surrendered to the Arab embargo.
In contrast to Amoco, BP does not operate in Israel and is very active in the Arab States, most of which do not have diplomatic relations with Israel.
The tension is mainly because of the fact that British Petroleum is the controlling owner in the new merged company, since it owns 60% of its shares.
This merger has made the company the third largest fuel company worldwide. At this stage, Amoco still has no information on the continuation of its activities in Israel, against the backdrop of BP’s total disregard during past decades of any activity whatsoever in Israel. Amoco has no estimates regarding the future. At this stage, Amoco continues to be active in several key energy projects in Israel. The company is participating in an international tender to establish a private power station to produce electricity at Ramat Hovav, at an investment of $200-$250 million. It is also bidding in a tender for the infrastructure of a natural gas conductor in Israel, at an investment of hundreds of millions of dollars.
Amoco also has extensive contacts with oil refineries in Israel, in all aspects of the trade of fuel products.
Amoco is also likely to be connected to a future venture, which will bring hundreds of dollars worth of natural gas from Egypt to Israel. At this stage, the Egyptian government is freezing this venture out of political considerations.
Published by Israel's Business Arena August 12, 1998.