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UK firm seeks Mid-East gas deal Israel mulls buying Palestine gas
(about 1 hour later)
UK energy firm BG Group has confirmed it is in talks to agree a deal to supply Palestinian gas to Israel. UK energy firm BG Group has confirmed it is in talks to agree a contract to supply Palestinian gas to Israel.
Previously part of British Gas, BG is set to meet Israeli negotiators next week to work out a 15-year contract, according to a report in the Times. BG discovered the Gaza Marine field, which is controlled by the Palestinian Authority, off the coast of the Gaza Strip in 2000.
This would allow BG to develop a field, controlled by the Palestinian Authority, which it found in 2000 off the coast of the Gaza Strip. Any deal would represent a landmark in Middle Eastern relations, but BG said it would first require agreement between both governments.
Any agreement would represent a landmark in Middle East relations. Israel has previously vowed never to buy gas from its neighbour.
Lengthy negotiations
"We have been in negotiation with Israel for many, many said a BG spokeswoman.
The gas field is located off the coast of the Gaza StripThe gas field is located off the coast of the Gaza Strip
The project has been beset by problems since BG discovered the field, which it says contains one trillion cubic feet of gas, with Israel previously vowing never to buy gas from its neighbour. "Most importantly, we need a bilateral agreement between both governments to get the go-ahead on this. We are working on that."
However, according to the Times, BG is now hoping to sign a £2bn ($4bn) deal for a 15-year gas supply contract with the country. The Palestinian Authority would receive $1bn in royalties. BG, previously part of British Gas, is seeking a 15-year contract.
Under the proposals, BG would transport gas from the Gaza Marine field through an undersea pipeline to the port of Ashkelon. According to press reports, BG is hoping to sign a $4bn (£2bn) deal that would see the Palestinian Authority receive $1bn in royalties.
Under the proposals, BG would transport gas from the Gaza Marine field through an undersea pipeline to the Israeli port of Ashkelon.
The field contains one trillion cubic feet of gas, and could reportedly supply 10% of Israel's annual needs.
If the project gets the go-ahead it would be a major boost to the economies in the Palestinian controlled territories.
Ongoing violence, especially in the Gaza Strip, has seen much economic activity grind to a halt, leaving the territories heavily reliant upon financial aid from overseas.