A long-mooted $1bn project to develop natural gasfields off the Gaza Strip has won Israeli support in principle and is on track to be given the green light, Palestinian and Israeli government officials said. Benjamin Netanyahu’s government is “very supportive” of the project, which would see the fields exploited on behalf of the Palestinian Authority by investors led by BG Group, an Israeli government official involved in the deal told the Financial Times.
The fields, which contain about 1tn cubic feet of natural gas – about a third of the UK’s annual consumption of the fuel – would take three to four years to develop, meaning they could be producing gas by 2017. Capital investment in the project would total about $1bn, and it would bring in $6bn to $7bn of revenues a year, some of which would go back into the squeezed Palestinian budget in the form of royalties and taxes and help to defray Ramallah’s chronic fiscal and trade deficits.
A senior Palestinian official said that because of positive signals from Israel’s government, the PA was now negotiating a revised concession agreement with the other investors, BG and Consolidated Contractors Company – an Athens-based, Palestinian-owned construction and engineering group – which he hoped would be finalised “in the coming few days”.
“We have been preparing ourselves, given the positive signals we received from the Israeli side, that they would be willing to make the implementation of this project possible,” said the Palestinian official, who asked not to be named as the deal is not final yet. “We have taken steps to prepare for this, including having serious discussion with BG about the terms of the licence.”
The next step would be to secure the Israeli permits, which could take “a few weeks”, the Palestinian official said. more (subscription)