Billionaire Adelson to Netanyahu: “Streamline Gas Industry Regulations”; Thousands Protest against Deal in Tel Aviv

Four activists were detained on Saturday night, June 27, after scuffles with police in Tel Aviv during mass protests against the impending gas deal between the government and a US-Israeli energy conglomerate. Thousands of Israelis flooded the streets to oppose a deal approved by the cabinet on Thursday which would see the US company Noble Energy and the Israeli conglomerate Delek Group develop Israel’s Tamar and Leviathan offshore gas reserves, discovered in the Eastern Mediterranean in 2009 and 2010. Blocking roads and chanting slogans for the nationalization of the gas, the protesters demanded more transparency for the shady gas deal, as they rallied at the city’s Habima Square before marching to the government complex.

The extreme-right government is expected to submit today (Monday, June 29) the deal to parliament for approval next week, but the demonstrators demanded to stop the deal as both companies are owned by the Israeli tycoon Yitzhak Tshuva. Organizers argue that, once approved, the deal would establish a monopoly over natural gas without sufficient supervision and consequently result in increased prices for Israeli consumers. Before the rally, Israeli media reported that prices for natural gas would rise, as demanded by Tshuva’s conglomerate, higher than those proposed by the finance ministry. It was also reported that the government agreed not to regulate gas prices.

Thousands of Israelis flooded the streets on Saturday night, June 27, to oppose the gas deal approved by the cabinet

Thousands of Israelis flooded the streets on Saturday night, June 27, to oppose the gas deal approved by the cabinet (Photo: Activestills)

Veteran Hadash Knesset member, Dov Khenin (Joint List) on Friday asked Attorney General Yehuda Weinstein to disqualify Prime Minister Benjamin Netanyahu from being part of the decision-making process in the government’s emerging compromise agreement with the two companies operating the country’s offshore natural gas fields.

Khenin made the request following revelations by Haaretz earlier Friday that billionaire businessman Sheldon Adelson wrote to Netanyahu last July, calling upon the prime minister to “streamline regulations in Israel’s gas industry.” In his request, the communist MK contended that “the close ties between the prime minister and Adelson, and the fact that Adelson openly supports the prime minister, publishing a newspaper which is identified with Netanyahu’s positions, raise concerns that the prime minister has a direct stake in advancing Adelson’s interests and in acceding to his requests.”

Adelson’s letter – written on behalf of the U.S. Chamber of Commerce and the U.S.-Israel Business Initiative, which he chairs – discussed many topics, but the gas industry is the only one specifically mentioned Khenin states. “Adelson proposed ‘streamlining regulation,’ an expression that often means relaxing it,” he added, noting that the billionaire also suggested launching a campaign to inform the Israeli public of the “benefits” of the gas industry.

Khenin appealed to Weinstein, asking him to instruct the prime minister to desist from handling the subject due to a potential conflict of interest. “Adelson appealed to Netanyahu as the head of a group [U.S.-Israel Business Initiative] that includes Noble Energy, the company that obtained most of the control over the gas fields along Israel’s coastline. Adelson’s close ties with Netanyahu are well known,” wrote Khenin. “In view of these circumstances, there is a conflict of interests that precludes the prime minister from continuing to lead attempts to settle the gas issue. I ask you to instruct the prime minister to immediately desist from dealing with this area.”

As Haaretz reporter Uri Blau revealed on Friday, in a three-page letter written to Netanyahu on July 17 last year, Adelson laid out the details of an initiative to strengthen ties with Israel. Among the points he raised was a suggestion to update the Free Trade Agreement between the United States and Israel, to open a Chamber of Commerce office in Jerusalem, encourage visits by U.S. congressmen to Israel, and to strengthen ties in research and development. He also proposed streamlining the regulation of natural gas and to launch a campaign that would underscore the advantages of this industry.

The regulation of natural gas is critical for Noble Energy. Together with the Delek Group, the U.S. firm is the controlling shareholder in the Tamar and Leviathan gas fields. Both companies are currently holding negotiations with the state over the terms of regulation applying to these and other, smaller gas fields (Karish, Tanin) in which they are partners. On August 14, about a month after Adelson’s letter, the then-director general of the Prime Minister’s office, Harel Locker, wrote back. “Dear Mr. Adelson,” he wrote, “Prime Minister Benjamin Netanyahu has forwarded me your letter … and has asked that I spearhead the effort to advance our common goals. Please be assured that the Prime Minister appreciates and shares your desire to continue to further strengthen the already robust economic ties between our countries… We look forward to working with the Chamber of Commerce to advance the initiatives detailed in your letter. We have already begun laying the groundwork for a strategic economic dialogue between our governments, which I expect to begin in the near future. This dialogue will help to promote economic partnerships and cooperation between our two countries in both the public and the private sectors,” wrote Locker.