Does the Prospective Purchase of British Gas from Gaza's Coastal Waters

From JCPA Vol. 7, No. 17, 19 October 2007, by Lt.-Gen. (ret.) Moshe Yaalon:

[Synopsis]

• British Gas is supposed to be the crown jewel of the Palestinian economy, and provide part of the solution to Israel's pressing energy needs. The British energy giant, now called the "BG Group," and its local partners - the Palestinian Authority under Mahmoud Abbas and the private, Palestinian-owned Consolidated Contractors Company (CCC) - are currently involved in advanced negotiations to sell to Israel massive amounts of natural gas - reserves of nearly 1.4 trillion cubic feet - that BG first discovered in 2000 off the Gaza coast. The market value of the gas has been estimated at $4 billion. Therefore, sale of the gas to Israel would mean a billion-dollar windfall for the PA and, potentially, for the Palestinian people.
• Unfortunately, British assessments, including those of former Prime Minister Tony Blair, that Gaza gas can be a key driver of an economically more viable Palestinian state, are misguided. Proceeds of a Palestinian gas sale to Israel would likely not trickle down to help an impoverished Palestinian public. Rather, based on Israel's past experience, the proceeds will likely serve to fund further terror attacks against Israel. No less threatening is the fact that terror organizations associated with the global Jihad, like al-Qaeda, will be highly motivated to attack any British Gas installation off Gaza's shores that provided fuel to Israel.
• For Israel, the need for BG's gas may have already taken a toll. It is possible that the prospect of an Israeli gas purchase may have played a role in influencing the Olmert cabinet to avoid ordering a major IDF ground operation in Gaza, despite at least 1,000 rocket and mortar attacks against southern Israel since the Hamas takeover of Gaza in June 2007.
• Clearly, Israel needs additional natural gas sources, while the Palestinian people sorely need new sources of revenue. However, with Gaza currently a radical Islamic stronghold, and the West Bank in danger of becoming the next one, Israel's funneling a billion dollars into local or international bank accounts on behalf of the Palestinian Authority would be tantamount to Israel's bankrolling terror against itself. Therefore, an urgent review is required of the far-reaching security implications of an Israeli decision to purchase Gaza gas.....

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[Conclusion]

....Conduct a Thorough Security Assessment Before Approving the British Gas Deal
The multiple dangers lurking behind Israel's potential natural gas purchase from BG have not deterred another attempt at finalizing a deal, due in large part to the redoubled efforts of Quartet envoy Tony Blair. The latest indications are that the BG Group, with the full backing of the British government, intends to finalize a multi-year agreement with Israel before the end of 2007.
The dangers inherent in Israel's potential purchase of British Gas from the marine reserves off Gaza require an immediate, comprehensive, interagency security assessment by the IDF, Israeli Security Agency, Mossad, and other organs. This type of interagency assessment did not take place when I was IDF Chief of Staff from 2002 to 2005. Since then, to the best of my understanding, no comprehensive security assessment has occurred, despite the intention of the parties to sign an agreement in the coming weeks.
Regional and local security conditions have worsened since 2005, and Israel must be prepared to face a possible two-front war against Hamas in Gaza, and Syria and Hizbullah in the north. Therefore, Israel will pay a painful price in its security if the British Gas transaction were to take place in the foreseeable future.
Israel needs additional sources of energy, including natural gas, and the Palestinians clearly need to create a peaceful civil society and a self-sustaining economy. However, with Gaza currently a radical Islamic stronghold, and the West Bank in danger of becoming the next one, Israel's funneling a billion dollars into local or international bank accounts on behalf of the Palestinian Authority would be tantamount to Israel's bankrolling terror against itself. Therefore, an urgent review is required of the far-reaching security implications of an Israeli decision to purchase Gaza gas by the State Comptroller's office or another external review panel.