Know More About Palestine

Monday March 7, 2011 2:31 PM (EST+7)

RAMALLAH, March 7 (JMCC) - Israeli officials have asked Palestinians to reopen negotiations over untapped natural gas fields off the Gaza coast, reports the Israeli publication Globes.

The overture was made after gas flow from Egypt was cut in February due to an explosion in a Sinai pipeline. Years of talks had failed to yield an agreement to harvest the fields, which are partially in Palestinian waters.

Israel proposes that negotiations discuss development of the Gaza Marine offshore natural gas field, and the Noa gas field offshore from Ashkelon, part of which is located in Palestinian waters. BG Group plc (LSE; NYSE: BG) owns 60% of the Gaza Marine license, Consolidated Contractors Company (CCC), owned by Lebanon’s Houri family owns 30%, and the Palestinian Investment Fund (PIF) owns 10%. Noble Energy Inc. (NYSE: NBL) owns 47% of the Noa license and Yitzhak Tshuva-controlled Delek Group Ltd. (TASE: DLEKG) owns the rest through subsidiaries Delek Investments and Properties Ltd., Avner Oil and Gas LP (TASE: AVNR.L), and Delek Drilling LP (TASE: DEDR.L).

No agreement was reached in two previous rounds of talks between Israel and the Palestinian Authority. The first round of talks began in 2000, shortly after BG Group discovered the gas field. Israel Electric Corporation (IEC) (TASE: ELEC.B22) wanted to buy gas from the reserves, but then-Prime Minister Ariel Sharon opposed a deal. Then-Minister of National Infrastructures Yosef Paritzky supported a deal, arguing that Israel could not rely on Egyptian gas, and needed a third supplier, in addition to Delek Group and Noble Energy's Yam Tethys reserves offshore from Ashkelon. Negotiations collapsed in 2005 after Paritzky was forced to resign in an embarrassing scandal.

The second round of talks began under Prime Minister Ehud Olmert, but collapsed in 2007 in a dispute over prices.

The proposal for talks comes as political negotiations between Palestinians and Israelis are stalled over Israel's continuing settlement construction.







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