Do the Abraham Accords open up new energy opportunities? - comment

Published: MARCH 6, 2021 22:06

THE mammoth Leviathan natural gas pipeline-in-progress. (photo credit: COURTESY OF NOBLE ENERGY) — THE mammoth Leviathan natural gas pipeline-in-progress.

(photo credit: COURTESY OF NOBLE ENERGY)

A key cooperation opportunity lies in the field of energy, and specifically alternative energy transportation methods from the Persian Gulf to Europe through the Mediterranean.

The signing of the Abraham Accords and warming ties with Saudi Arabia open up many and varied regional cooperation opportunities for Israel.

A key cooperation opportunity lies in the field of energy, and specifically alternative energy transportation methods from the Persian Gulf to Europe through the Mediterranean. On a December 2020 visit to Abu Dhabi shortly before leaving office, Former Trump administration Energy Department secretary Dan Brouillette met with his counterparts from the Emirates, Bahrain, and Israel to discuss energy security and the use of pipelines for gas exports. “If we can move natural gas to the coast of Egypt or the coast of Israel, then we’re moving it through the Mediterranean,” he said. He was referring both to the strategic aspect of such a move vis-à-vis Iran, and the importance of diversifying energy export routes from a sensitive region such as the Persian Gulf.

Following a visit to the Emirates in late January, Israeli Energy Ministry Director-General Udi Adiri issued a statement underscoring “the unique opportunity to develop the energy economy of both states and the entire region.” Adiri said his office was promoting a series of infrastructure projects designed to provide a connection to Europe, “and perhaps to Gulf infrastructure in the future. Electricity and natural gas projects will improve regional cooperation.”

It should be noted that the Europe-Asia Pipeline Company (formerly the Eilat-Ashkelon Pipeline Company) signed a memorandum of understanding in October 2020 for the transportation of fossil fuel from the Persian Gulf to Israel. The fuel and oil products from the UAE will be shipped to a Red Sea terminal in Eilat and from there to the Mediterranean Ashkelon terminal for distribution to clients. The signing ceremony was held in the presence of the then-US Treasury Secretary and the Emirati Minister of Economy.

Reports and analyses have also emerged in recent weeks about plans for an overland pipeline through Saudi Arabia to the Mediterranean. These plans have been denied, citing the high costs of such a project, but those involved in the plans appear to be seized with a spirit of creativity.

The diplomatic-strategic rationale is clear. Diversifying gas and oil export routes from the Gulf would reduce the total dependence on the Strait of Hormuz – a narrow, strategic sea route considerably vulnerable to an Iranian attack. In other words, a pipeline running through Saudi Arabia to the Egyptian or Israeli coasts, as mentioned by the former US Energy Secretary, could change the regional energy map and the relationships between the countries involved.

For now, these ideas and plans are all only on paper. However, they have already generated clear concern in Egypt given their possible implications for the Suez Canal.

The head of the Canal Authority has expressed concern about linking the Europe-Asia pipeline to the Persian Gulf. In an Egyptian television interview (January 29) he noted that Egypt was examining ways to deal with the “Israeli-Emirati project” – as he defined it – that could significantly reduce traffic through the canal.

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Income from shipping through the canal, it should be noted, is vital to the Egyptian economy, which has already been severely affected by the novel coronavirus crisis. Such plans could also undermine Egypt’s aspirations to become a regional energy hub.

AS PRECIOUSLY noted, the projects’ diplomatic-strategic rationale is sound. The congruence of interests between the Gulf States and Israel, largely based on fear of Iran, could be translated into the energy field.

Nonetheless, Israel has no interest in undermining its relationship with Egypt. Serious thought must be given to integrating Egypt or compensating it appropriately if that is not possible. From an American standpoint, diversifying export alternatives from the Persian Gulf fits its interest in energy security and does not appear to contradict the Biden Administration’s desire to return to the nuclear deal with Iran.

Nonetheless, these plans generate many challenges and question marks. Can the Gulf States and Saudi Arabia adopt such strategic decisions? Is the level of trust with Israel sufficiently high and stable? And if so, can it be preserved and survive future crises? What about the problematic implications for Egypt? And what about the tremendous costs of such an overland pipeline? And of course, what is the position of the new US administration?

In-depth thinking is required to examine the seriousness and feasibility of such plans. Clearly, the Gulf angle opens up a new horizon for relevant players.

Israel is at a strategic-energy crossroads, facing a new range of options. At a news conference (February 14)) alongside the visiting Cypriot president, Prime Minister Benjamin Netanyahu referred to regional cooperation in the post-Abraham Accords era, including energy cooperation. Netanyahu mentioned the UAE’s desire to join the Eastern Mediterranean Gas Forum and reiterated the shared interest in the proposed East-Med gas pipeline to Europe. The Cypriot president presumably asked how the Gulf angle could be combined with the Hellenic one. As far as Israel is concerned, the two could be complementary.

At issue are strategic-scale decisions and projects. The COVID-19 crisis has exacerbated global economic uncertainty and cast a measure of doubt on the feasibility of these energy plans and the willingness of international energy companies to invest significant sums given the unclear post-pandemic economic picture.

Nonetheless, Israel is at a fascinating crossroads with significant room for maneuverability. It must ensure a close relationship with the Biden Administration, a necessary precondition for taking advantage of the maneuvering room it now has. The main obstacle for Israel is clear: to conduct itself in light of US plans to renew the nuclear deal with Iran, and to a lesser extent in light of the ongoing Israeli-Palestinian conflict, in a manner that does not place it on a collision course with Biden’s Washington.

The writer is a policy fellow at Mitvim – The Israeli Institute for Regional Foreign Policies and a former Israeli ambassador to Cyprus. He is currently also a lecturer at the Yezreel Valley College.