Israeli cabinet approves gas outline agreement

Leviathan

Benjamin Netanyahu: This decision will earn the state treasury hundreds of millions of shekels.

The Israeli cabinet today approved the natural gas plan. All the ministers voted in favor except for Minister of Environmental Protection Avi Gabai. Gabai, who returned to Israel for 24 hours in order to take part in the cabinet meeting, said in advance, "Without a real change on the question of energy security, I'll vote against the gas plan."

Minister of the Economy Aryeh Deri voted in favor, but has not decided whether to take responsibility for using Section 52 of the Restrictive Trade Practices Law authorizing him to enforce approval of the agreement.

Minister of Welfare and Social Services Haim Katz, Minister of Finance Moshe Kahlon, and Minister of Construction Yoav Galant did not participate in the crucial vote, due to conflicts of interest that they announced in advance.

At the beginning of the meeting, Prime Minister Benjamin Netanyahu said, "The decision that we make today will be nothing less than historic. This decision will earn the people of the country and the state treasury hundreds of millions of shekels. This money will go for education, health, welfare, and other national needs.

"I want to praise the work by the team headed by Minister of National Infrastructure, Energy, and Water Resources Yuval Steinitz, which substantially reduced the price that the state will pay for gas, as well as other changes that greatly improved the plan. I believe that we will pass this decision by a large majority, and justly so. I am not impressed by demagoguery - for me, it is only demagoguery, even though people can believe in what they say, but the country needs gas. Unfortunately, gas resources are going to be developed in our region regardless, and we have to make sure that our resources work at full steam. We need to get the gas out of the sea. This decision is an important milestone. We are overcoming the obstacles, one by one; they will not stop this process. The gas will leave the seabed and reach the people of Israel, Israeli industry, and the Israeli economy for the benefit of all Israelis.

"Any objective examination will prove that this plan is a significant improvement on the existing situation. One more thing must be realized, however - this cannot be stopped. When it is right to do something, and it is so fateful for the Israeli economy and Israel's strategic situation, it cannot be stopped. They will look for another way to delay it, another excuse, another reason - but it will not help. This gas plan will pass in any case, and it is time for it to pass. The real interests of Israel require that it be passed, and as soon as possible."

Steinitz said, "After several years of regulatory deadlock and delay that have cost the state billions and damaged its energy security, I am convinced that the current plan is the best thing for Israel and its people. The important comparison that should be made is to the current situation: is this an improvement in the current situation? Where prices are concerned, there will be a significant improvement in the current situation, there will improvement in competition (today there is only the Tamar gas reservoir; there will be three reservoirs, and perhaps additional reservoirs); there will be improvement in energy security, and additional revenue for the state. The gas plan also has strategic economic value: an opportunity is being created for an economic connection on the peace axis. The improvement is significant, and preferable to any further delay."

The plan submitted to the cabinet today includes two key changes, in comparison with the original plan. These were added during the public hearing on the plan, and at the request of the State Comptroller and the Governor of the Bank of Israel.

Published by Globes [online], Israel business news - www.globes-online.com - on August 16, 2015

© Copyright of Globes Publisher Itonut (1983) Ltd. 2015

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