We Lost Trust in the Government of Israel, Claims Israel's Gas Monopoly Leader

Noble Energy, the operator of major resources offshore Israel, told the country’s high court of justice that it had lost trust in the government of Israel.

"We arrived at this situation because the Israeli regulatory system is broken, and this situation causes Noble Energy's owners, shareholders and managers to lose trust in the government of Israel and its declarations," Noble said.

The declaration was made despite the fact that Noble and the Israeli government are both respondents, on the same side, in a hearing at the High Court of Justice on February 3. At that hearing, the court will consider four petitions to block the implementation of the natural gas regulatory framework.

The petitions challenge the decision by prime minister, Benjamin Netanyahu, to override the antitrust law on national security grounds; the stability clause that gives the monopoly up to 15-year immunity from regulatory changes; export quotas; taxation; and environmental issues.

The petitions question, among other things, the trustworthiness of papers in support of the framework, submitted by the National Security Council and the Economic National Council, both of them departments in the Prime Minister's office.

Noble's statement also accuses the petitioners of "working tirelessly for a few years, in order to prevent the development of the gas reservoirs off shore Israel. From time to time, the arguments changed; however, basically it is a worldview according to which the good of the country demands expropriations of the reservoirs from Noble and its partners."

In addition to Noble's response, the government of Israel, a public organisation and several other interested companies also issued statements in defence of the framework.

In its statement, the government attacked the petitioners. "Reading the four petitions shows that every one of them is lacking factual, economic and legal validity. Rather their common practical purpose is a single and simple one – to prevent the government from advancing its policies in the Israeli natural gas sector,” an attorney for the government said. He also criticised the petitioners for not presenting an alternative plan to the framework.

The Manufacturers Association of Israel has also come out in defence of the framework, arguing that "the current framework (with its advantages and disadvantages) provides the certainty and stability necessary to bring about the development of Israel’s natural gas market as quickly as possible." The association's president, Shraga Brosh, is a part owner of Oshrad Natural Gas, a natural gas distribution company with close ties to the monopoly.

Delek Drilling and Avner, both controlled by Delek Group, said that "the four petitioner groups, each on its own, have formulated a long-term strategic policy for the natural gas industry in Israel, based on a virtual reality they have created." They also blame the petitioners for Australian energy company Woodside's decision to withdraw from the Leviathan project two years ago.

The four petitions were submitted, among others, by the Movement for Quality Government in Israel, the College of Law & Business, The Israel Energy Forum, the Meretz party and the Labor party, the biggest opposition party in the Parliament.

In its statement, Noble made clear that the stability clause is a prerequisite for the development of the natural gas resources offshore Israel.

Ya'acov Zalel