Israel, Turkey eager to rebuild Gaza

Gaza beach Photo: Reuters

Quartet representative: The state of water, electricity, and sewage in the Gaza Strip also affects Israel.

"Like many other countries, including Qatar and European nations, Turkey wants to help rebuild infrastructure in the Gaza Strip, and Israel now realizes that this is in its interest, because the state of water, electricity, and sewage in the Gaza Strip also affects Israel. It is a win-win situation for both sides," head of energy at the office of the quartet Ariel Ezrahi told "Globes."

Following the Turkey-Israel reconciliation agreement signed by directors general of the two countries' respective Ministries of Foreign Affairs and approved today by the Israel security cabinet, "Globes" is presenting a description of the state of infrastructure in the Gaza Strip - water, electricity, sewage, and ports - how much money will be invested in building a desalinization facility and a water transportation network there, how sewage in the Gaza Strip affects Israel's coastline, and whether the Gaza Marine natural gas reservoir will be developed.

Electricity

Electricity is the main infrastructure required for normal living and for other infrastructure. A 140-megawatt power station has been operating in the Gaza Strip since 2003. The only power station in the Gaza Strip, it currently operates at partial capacity using diesel fuel purchased by the Palestinian Authority (PA) from Paz Oil Company Ltd.'s (TASE:PZOL) oil refinery in Ashdod.

This plant, however, supplies only a quarter of the electricity that the Gaza Strip needs. The 120 megawatts supplied to the Gaza Strip by Israel Electric Corporation (IEC) (TASE: ELEC.B22) is also insufficient. The result is that for 16 hours a day, residents of the Gaza Strip receive no electricity. Following Operation Pillar of Defense and Operation Protective Edge, the situation became even worse. In Operation Pillar of Defense, for example, an IDF tank blew up the fuel tanks on the power station site, putting it out of action.

Up until 2010, the European Union paid for the fuel purchased from Paz, but since that time, the PA has borne the full cost of the fuel. The PA, on the other hand, is unable to collect money for the electricity it supplies to the residents; its debt to IEC is growing by leaps and bounds, and currently exceeds NIS 2 billion. After Operation Protective Edge, which ended in August 2014, the Turkish government proposed stationing a ship off the coast of the Gaza Strip to provide electricity to the people there for another few hours a day, but Israel rejected this proposal, asserting that the Gaza Strip lacked infrastructure for hooking up the ship.

Qatar also proposed a solution for the Gaza Strip electricity crisis. Last September, it proposed paying for a natural gas pipeline from Israel to the power station, mediated by Qatari Committee for the Reconstruction of Gaza chairman Mohammed Al-Emadi, who met a number of times with Coordinator of Government Activities in the Territories General Yoav Mordechai. According to Ezrahi, the new reconciliation agreement now allows Turkey to join other countries in Gaza Strip energy infrastructure investment. The agreement does not address the type or volume of the investment. Turkey can, if it wishes, build a new power plant, upgrade the existing one, or invest hundreds of millions of dollars in upgrading the electricity distribution network in the Gaza Strip.

Water

The water crisis facing the Gaza Strip is among the worst in the world, with 90-95% of the water from the aquifer being polluted by sewage, chemicals, and seawater. As Israeli Military Intelligence Directorate Herzl Halevi says, "According to most sources, the Gaza Strip is on a collision course with an environmental and sanitation disaster." A UN report on the subject stated that by 2020, it will be impossible to live in the Gaza Strip.

Up until Operation Protective Edge, Israel supplied the Gaza Strip with five million cubic meters of drinking water a year, and increased this to 10 million cubic meters a year following the operation. The PA estimates demand for water in the Gaza Strip at 200 million cubic meters a year. Water is supplied from Israel through two pipelines: one through Bani Suheila east of Khan Yunis, and the other connecting Ben Said east of Deir al-Balah.

As a result of the severe shortage, 40 private desalinization facilities have been built in the Gaza Strip. These are unsupervised, and their water is unfit for drinking. The severe crisis has resulted in a black market in water. Gaza Strip residents dig illegal wells, and merchants transport water in tankers and sell it at exorbitant prices. According to UNICEF data from 2014, four out of five Gaza Strip residents buy drinking water from private suppliers at a cost estimated by the World Health Organization at NIS 35 per cubic meter - an extremely heavy economic burden for many families. For the sake of comparison, a public outcry arose in Israel when the price of water was raised to NIS 11 per cubic meter (the price includes the cost of sewage treatment).

The reconciliation agreement with Turkey will now allow the construction of a desalinization plant producing 55 million cubic meters of water a year. Exports estimate the cost of construction at $200 million, and the necessary investment in the Gaza Strip water transportation network at an additional $200-250 million. Engineering work in the Gaza Strip making it possible to increase the capacity of the water system by 10 million cubic meters was completed only in recent weeks.

EcoPeace Middle East (formerly Friends of the Earth Middle East) Israel director Adv. Gidon Bromberg asserted that building the plant would help the Gaza Strip in the long term, but that urgent solutions in the short term were also necessary. "Until then, the absence of interim solutions to the distress is liable to bring about a scenario in which tens and perhaps hundreds of thousands of thirsty Gaza Strip residents are trying to find drinking water in any way possible."

Sewage

More than 30 months have passed since the construction of the first regional sewage treatment facility of its kind in the Gaza Strip at an investment of over $80 million by the World Bank and the international community, but this facility stands idle, because there is not enough electricity to operate it. According to Bromberg, because Israel is unwilling to supply electricity specifically for operation of the Gaza Strip sewage purification facility, over 90 thousand cubic meters of sewage are dumped daily in valleys and riverbeds in the Gaza Strip, and the ground water makes its way every day to the Mediterranean Sea, reaching a few kilometers away from the Ashkelon shore near one of Israel's largest desalinization facilities.

Accumulations of sewage and pollution of drinking water reservoirs are creating isolated outbreaks of infectious diseases, such as typhus and cholera. According to experts, the likelihood of these diseases spreading to the Jewish communities near the Gaza Strip is increasing. The 120 kilowatts of electricity a day supplied by IEC is not enough to operate the purification facility. As early as April 2013, Palestinian Energy Authority acting chairman Dr. Omar Katana sent a letter to then-IEC CEO Eli Glickman asking for a 10 megawatt increase in the electricity supplied by Israel to the Gaza Strip, to be used solely to operate the sewage facility. The World Bank estimates that even three megawatts will be enough to operate the facility for the next three years, at least until production facilities are built in the Gaza Strip. More than three years have passed since this appeal, and there is no electricity. Furthermore, the facility was bombed in in Operation Protective Edge, causing an estimated $150,000 in damage.

The health hazards in the situation that has emerged were reflected with unusual harshness in a report published by the Institute for National Security Studies (INSS) and EcoPeace. The report's authors - Bromberg, Dr. Oded Eran, and Michal Milner - defined the state of sewage in the Gaza Strip as an existential strategic problem of the highest order for Israel, and added that pandemics in the Gaza Strip would not stop at the border, and would jeopardize all of Israel.

The Israel Oceanographic and Limnological Research Institute also warns of the health risks, pointing to an increase in the number of microbes in Ashkelon's shallow water, according to one hypothesis caused by sewage from the Gaza Strip. In the past, the Israel Water Authority recognized the possibility of partial pollution of Israel's underground aquifer caused by sewage seeping from the Gaza Strip, and sewage was the cause of polio cases discovered in Israel in 2014. A Coordinator of Government Activities in the Territories unit recently approved a special allocation of six megawatts of electricity for the purification facility, but the electricity distribution network in the Gaza Strip is not powerful enough to deliver the electricity. The unit is therefore currently considering the construction of a special power line to the facility. Turkey's investment in power plants and the electricity network in the Gaza Strip will help promote the operation of the sewage purification facility.

Natural gas

The Gaza Strip has one natural gas reservoir - Gaza Marine. This reservoir, located 35 kilometers off the Gazan coast, was discovered in 2000 by British Gas (currently Royal Shell Dutch). The reservoir contains an estimated 32 BCM of gas. Since it was discovered, British Gas has tried several times to market the gas to IEC, but negotiations in the matter were unsuccessful. In 2013, "Globes" revealed that Israel had continued secret negotiations with the company aimed at developing the reservoir for the benefit of the Palestinian population. No agreement resulted from these contacts, again due to opposition from Israel and IEC, which preferred buying Israeli gas. Minister of National Infrastructure, Energy, and Water Resources Yuval Steinitz told "Globes" today that another reason for the delay in developing the reservoir was a dispute between the PA and Hamas over ownership of the royalties and tax revenues resulting from the sale of gas from Gaza Marine.

Gaza Strip residents hoped that the solution would come from Jordan. In January 2015, Jordanian House of Representatives Energy Committee chairman Jamal Gammoh announced that instead of buying natural gas from Israel, as had been agreed in a letter of intent signed by the Leviathan reservoir partners and the Jordanian Electric Power Company, Jordan would buy natural gas from Gaza Marine. The Jordanians announced that they planned to import 1.5-1.8 BCM a year from the reservoir. The parties have not yet signed a binding agreement, and the gas is still deep beneath the waves.

Last March, "Globes" revealed that secret intensive negotiations had taken place between Israel and the PS, led by the Quartet, for supplying gas from Leviathan to the Gaza Strip power station - seven years after the PA's attempts to import gas into the Gaza Strip. Sources added that the security cabinet had approved the measure in principle, and that the Ministry of National Infrastructure, Energy, and Water Resources had authorized the partners to negotiate.

Unfortunately for the Gaza Strip residents, the reconciliation agreement with Turkey does not include a demand for encouragement of development of the Gaza Marine reservoir. If Israel nevertheless wants to help develop it, it could reconsider buying gas from it. Alternatively, it is also possible for the existing power plant, or the new one to be built, to buy gas from Gaza Marine, instead of Leviathan. In this case, a pipeline would be laid from the reservoir to the Eilat-Ashkelon Pipeline Co., from there to the Israel Natural Gas Lines Company, and from there to the power station. Ezrahi says, "It will be pure profit for everyone if the Gaza Strip gets connected to natural gas. Beyond the economic benefit, using natural gas will also ease the severe air pollution problem in Gaza."

A port

The Gaza Strip has no port. Before Operation Protective Edge, Hamas demanded the construction of a port, but both Israel and Egypt rejected the proposal. The ceasefire agreement therefore included no commitment to building one. In view of the worsening state of Gaza Strip infrastructure, the political and military echelons in Israel renewed discussion of the question. The proposals discussed included proposals for construction of an artificial island off the Gazan coast, a port in Sinai, and a port on the coast of the Gaza Strip itself.

Both senior IDF officers and minister support the construction of a port. They argue that its approval can involve a commitment by Hamas to a long-term ceasefire. Prime Minister Benjamin Netanyahu and Minister of Defense up until a month ago Moshe Ya'alon, however were opposed. Turkey's demand for a port in the Gaza Strip was rejected, and was not made part of the Israel-Turkey reconciliation agreement. Goods for the Gaza Strip will therefore continue to go through Ashdod Port, and from there to the Gaza Strip, after undergoing security checks. According to figures cited by the Coordinator of Government Activities in the Territories, more than 139,000 trucks entered the Gaza Strip in 2015 through the Kerem Shalom border crossing.

Published by Globes [online], Israel business news - www.globes-online.com - on June 29, 2016

© Copyright of Globes Publisher Itonut (1983) Ltd. 2016

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Gaza beach Photo: Reuters
Gaza beach Photo: Reuters
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