Palestinian-Israeli clashes give Jordan new energy trouble

Renewed violence in Gaza and Israel jeopardizes an already troubled energy deal otherwise promising to give the turbulent Middle East hope for peaceful cooperation.

Energy-hungry Jordan has been edging toward imports of natural gas from fields off Israel. Two state-owned companies have agreements to buy gas at modest rates from an expansion of Tamar field. And Jordan’s National Electric Power Co. has signed a letter of intent to buy gas at much higher rates from larger, undeveloped Leviathan field.

The Hashemite kingdom needs the energy. Gas it once received from Egypt is unavailable thanks to sabotage of the Arab Gas Pipeline. And as many as 1 million refugees from Iraq and Syria boost its energy needs.

A study published this month by the German Marshall Fund of the United States calls these developments “the major causes of Jordan’s recent economic difficulties.”

According to the study, by Simon Henderson of the Washington Institute for Near East Policy, imports of heavy fuel oil, petroleum products, and natural gas burned for power generation absorbed more than 40% of Jordan’s national budget in 2014.

While Jordan now imports LNG from Qatar and the UAE via a floating facility at Aqaba, other, undeveloped options are inauspicious. They include construction of oil and gas pipelines from Iraq and the uncertain development of fields off Cyprus and Gaza.

Development of oil shale for power generation has begun but faces economic and water-supply constraints. And development of Eni’s giant Zohr discovery off Egypt requires time.

“Israeli natural gas remains the most logical option for satisfying Jordan’s energy demand,” Henderson writes.

But Tamar expansion and Leviathan development are mired in Israeli politics and bureaucracy. And Jordan’s King Abdullah apparently supports imports of Israeli gas but doesn’t push.

Anti-Israel sentiment remains high in the Jordanian public and parliament. Surging Palestinian-Israeli violence will stoke opposition to any expansion of business with Israel.

That’s regrettable. Jordan needs gas. Israel needs a market. And the Middle East needs more business and less bloodshed.

(From the subscription area of www.ogj.com, posted Oct. 16, 2015; author’s e-mail: [email protected])