The Paz - Africa-Israel Investments consortium filed suit against the state in the Tel Aviv District Court today. The consortium wants the court to declare it the winner in the $400 million natural gas pipeline tender.
Alternatively, Paz – Africa-Israel has asked to be allowed to participate in the tender at the point at which the tender was halted, and to halt negotiations that would give construction of the pipeline to other entities, including Israel Electric Corporation (IEC). The consortium asked for an urgent hearing on the matter.
Paz and Africa-Israel Investments control the consortium that submitted the only bid in the international tender to build the pipeline. Other companies in the consortium were PazGaz, controlled by Paz and the Ben-Shach family, and the Scorpio company, owned by Benny Steinmetz via Bateman Engineering.
The bid was disqualified in part because its foreign partner, Tractebel of Belgium, withdrew. The tenders committee could not agree on the two other foreign partners the consortium offered as alternatives.
Prime Minister Ariel Sharon decided a month ago to give the first part of the project to IEC in order to avoid delaying delivery of natural gas to IEC's natural gas power stations at Ashdod and Gezer, scheduled for mid-2004.
In its petition, Paz - Africa Israel claim that the disqualification of its bid meant the end of any chance for an independent private entity to build the pipeline, and left Israel’s natural gas infrastructure in the hands of natural gas consumers, chiefly IEC, or the gas suppliers, thus creating a dangerous vertical monopoly.
Published by Globes [online] - www.globes.co.il - on October 27, 2002