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March 28, 2016 1:11 pm

Israel’s High Court of Justice Deems Landmark Gas Deal Unconstitutional

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Gas drilling off the coast of Israel. Photo: via

Gas drilling off the coast of Israel. Photo: via – The Israeli High Court of Justice ruled that a landmark natural gas agreement is unconstitutional, dealing a major blow to Prime Minister Benjamin Netanyahu and energy companies.

Israel had reached an agreement between Israeli and American companies such as Houston-based Noble Energy and Israel’s Delek Group in order to pump recently discovered offshore natural gas reserves, arguing that the deal would help the Jewish state attain energy independence and significant revenue.

But the high court dismissed a clause in the agreement that would keep Israel from making any changes to the deal’s agreed-upon regulations for the next decade, calling the clause unconstitutional because it restricts the power of the Israeli Knesset legislature. The court’s ruling gives the Knesset one year to amend the plan, or the deal will be cancelled.

“The High Court of Justice decision severely threatens the development of the gas reserves of the State of Israel. Israel is seen as a state with excessive judicial interference in which it is difficult to do business. Certainly nobody has any reason to celebrate that the gas is liable to remain in the depths of the sea and that hundreds of billions of shekels will not reach the citizens of Israel. We will seek other ways to overcome the severe damage that this curious decision has caused the Israeli economy,” Netanyahu said about the ruling.

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Member of Knesset Shelly Yachimovich (Zionist Union), a leading opponent of the deal, called the ruling “historic and dramatic,” saying that “the High Court justices chose to put the brakes on the unchecked recklessness that was benefiting the gas tycoons.”

David Stover, chairman of Noble Energy, called the ruling “disappointing,” the Associated Press reportedA representative of the Delek Group called on the Israeli government to rework the agreement quickly, saying, “We don’t intent to put things on hold.”

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  • David Hoffman

    I have only the greatest respect for the Supreme Court of Israel, and I will need time to study the full decision. That said, if this report’s description of the ruling is accurate, it is a disaster. How can we Israelis expect foreigners to invest the vast sums of money and — more importantly — supply the know-how that they have and we do not, which are required to develop our natural resources, if we insist on the right to change the rules in the middle of the game whenever we feel like it? If a CEO agreed to such a thing, he would be liable to his shareholders for mismanagement.

  • Eric R.

    This natural gas is the modern Manna from Heaven and the Israeli left is throwing it back at Ha-shem.