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Israeli oil spill a snafu in nation’s growing industry

On the evening of December 3, a pipeline ruptured in the Arava desert in southern Israel. The Trans-Israel pipeline, owned and operated by Eilat Ashkelon Pipeline Company (EAPC), has spilled about 1.3 million gallons of crude oil (nearly 31,000 barrels) into the desert near Eilat. That’s enough oil to fill two Olympic-sized swimming pools. This river of oil stretching over four miles long has been called one of Israel’s worst ecological disasters, and although over 90 percent of the oil has been removed, it could take anywhere from months to years to assess and repair the damage.

EAPC cited a “mechanical failure” in a new part of pipeline, but the Israel Ministry of Environmental Protection (MoEP) is actively involving itself in the spill’s cleanup. Deputy Environmental Protection Minister Ofir Akunis is working with the Israel Nature and Parks Authority (INPA) and other environmental organizations to develop a comprehensive rehabilitation plan for the area. Akunis is set to bring this plan forward for cabinet approval on December 21. In the meantime, operation of the pipeline has been mandatorily halted, and the MoEP’s Green Police are mounting a criminal investigation into the matter to determine the circumstances leading up to the pipeline’s rupture.

Officials and environmental crews have worked tirelessly to remove the oil from polluted areas. The use of pump trucks helped to eliminate pools of crude, and 20,000 tons of contaminated soil has also been removed from the region. The radioactive earth has been relocated to Nimra landfill north of Eilat. EAPC is funding the clean-up operations, which have been rushed due to fears of flash flooding.

Though Eilat escaped contamination, primarily because to the ultimate lack of heavy rainfall which could have washed the slick south, the flowing crude oil has done a massive amount of damage. At least 3 Israelis were hospitalized for respiratory symptoms, likely due to exposure of toxic fumes. The toxic river flowed for some distance directly next to a local highway, causing the highway to be closed intermittently. But this spill isn’t just affecting Israel. The incident occurred near the Israel-Jordan border, and fumes from the release have hospitalized more than 80 Jordanians from nearby Aqaba.

The Evrona Nature Reserve has been the area hit hardest by the massive discharge of crude. The reserve is home to herds of rare deer and the northern-most groves of Doum Palm, a type of Egyptian tree. There are also stunning views of the Edom Mountains to the east of the reserve. But Akunis has demanded that the reserve be closed to visitors in the interests of public health. According to the MoEP website, about 50 private vehicles attempted to enter the park over the weekend but were redirected by park officials. Assessments by the INPA have determined that almost 36 acres of the reserve were covered in oil, damaging the flora and fauna, including 430 acacia trees. Although tests of the air quality in the park show high levels of benzene which could put pregnant women, young children and the elderly at risk, the MoEP reports that only a few small pools remain in the Evrona Nature Reserve.

The disaster has also brought to light former disputes regarding the Eilat-Ashkelon pipeline, which didn’t receive much attention up until the incident. Israel may actually owe Iran $100 million for the pipeline.

In the late 1950s, Israel was looking to build a pipeline amidst oil needs and political turbulence in the region. The young nation, which was only formally recognized as an independent nation in 1949, looked to Iran for the help it needed. Following a decade of uncertain planning, the two nations finally signed a formal 49-year contract on February 29, 1968. This agreement would only remain stable for the following ten years, until the Islamic Revolution in 1978.

After the revolution, the alliance was dismantled. Iran lost $120 million worth of unrefined crude, which was in the pipeline when the nations parted ways. Today, that oil would be worth $400 million. In 1994, the National Iranian Oil Company appointed an arbitrator, finally pursuing legal recourse for its long-abandoned assets. Arbitration proceedings eventually came to a head in Switzerland. By mid-2013, Swiss courts had ruled in favor of Iran. While Israel still has the opportunity to overturn this ruling with its own defense, the nation may still end up having to pay up to $100 million in restitution payments to Iran.

This oil spill comes at a pivotal point in Israel’s oil and gas development. Like the United States, Israel prizes energy independence. As the young nation strives to reach that goal, though, it has been struggling with some of the same issues that have plagued the U.S. boom. In an article for Fortune Magazine, Asia Society Policy Institute fellow Jeffrey Kupfer writes that Israel is grappling with whether or not to export natural gas.

A small country without well-developed energy assets, Israel started out having to import most of its energy resources, which was obviously a contributing factor to the construction of the Eilat-Ashkelon pipeline in the first place. According to Kupfer, Israel was dependent on imports for 60 percent of its electricity until just a decade ago. Recent years have seen the rise of the oil and gas industry in the nation, and in 2009, the Tamar natural gas field was discovered 50 miles off the Israeli coast. It was quickly followed by the discovery of the Leviathan natural gas deposit in 2010. Israel suddenly had over 30 trillion cubic feet (tcf) of natural gas at its disposal. Although the Leviathan discovery isn’t set to begin production until 2018, Israel already produces one billion cubic feet of natural gas per day.

Now Israel is more energy-secure than ever, and the nation’s natural gas supplies 50 percent of its electricity. That number is only expected to rise, and Israel finds itself wondering what to do with the excess resources. Israel is contemplating the potentially significant impact that exporting natural gas could have on stabilizing the Middle East. On the other hand, the young nation is eyeing the U.S. natural gas export strategy and looking at its own economic benefit. As Kupfer puts it, “A reliable supply of. . . natural gas could help underpin economic growth in Israel and neighboring countries, many of which face energy challenges. At the same time, the availability of export markets would also help attract the necessary capital to continue to develop the offshore fields.”

Steps have already been taken to help Israel’s neighbors. Noble Energy, a U.S.-based company which has played a significant part in the development of both Israeli natural gas fields, announced in September that it would provide 1.6 tcf of natural gas to Jordan over the over the course of the next 15 years, which the country might now seem due following the events of the pipeline rupture.

For the MoEP’s full timeline of events regarding the spill, click here.


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